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How to Choose a Temp Company

Minimize your costs and find the best help available by following these guidelines for choosing a temporary staffing company.
February 17, 2003
URL: http://www.entrepreneur.com/article/59650

Introduction

Very often, choosing a temporary help service amounts to nothing more than a last-minute phone call to fill an absence or to get help in a crisis. However, taking a more strategic approach to choosing a temp service can actually be very valuable. Not only can you minimize costs, but you may be able to find temps who are far more productive for the tasks at hand.

This guide is designed to give you the facts you need to choose and evaluate a temporary help agency for your business. The various sections are listed in the box above. You can choose to read this guide from beginning to end, or jump directly to a section of interest.

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How Temps Are Used

Most commonly, temporary employees are used to address normal fluctuations in a company's work flow. In order to save money, companies keep staff levels low and use temps to handle the excess work. Examples of this include hiring temps for large mailings, unexpected orders, or time-sensitive projects.

A second major use of temps is as contingency workers to fill positions that are temporarily vacant. This helps a firm to avoid overworking permanent employees and can reduce the need to shuffle job responsibilities.

A third use of temps is as a source for permanent employees. Businesses will often hire temps to fill a new opening in the company. If the person is good at the job, the company arranges with the temp service to hire the person on a permanent basis.

Types of Positions

Temporary work has broadened since its inception to include a wide range of fields and industries. Clerical and office positions continue to be the largest segment of all temp jobs, comprising almost 40% of all temporary positions. These positions commonly include administrative assistants, general office clerks, filing clerks, receptionists, typists, word processing operators, data entry clerks, and cashiers.

The second largest category, with one-third of all placements, are those involving industrial work, such as shipping/receiving and assembly line work.

A third category, with just over 15% of all placements, consists of technical workers such as computer programmers, analysts, or engineers, and professional workers in the accounting, legal, sales and marketing, and management areas. This ranks among the fastest growing categories, with specially trained temps becoming an important resource for many firms.

Differences Between Firms

Most temp agencies use newspaper advertisements, job fairs, and word of mouth to recruit candidates. National firms may attract greater numbers of candidates due to the brand name, but large, local firms are often equally well known within their region.

There are much greater differences, however, in how firms screen candidates before hiring. Some firms use computer testing to evaluate candidates, while others supplement this with psychological evaluations or personal interviews to select temps for the right jobs. If you need a temp with specific skills, computer matches are usually adequate, but personal interviews can help ensure that workers are better suited for your needs.

Pricing

Temp firms generally charge a fixed percentage greater than the hourly cost of a worker. For basic jobs, this can translate to total charges of $9 to $18 per hour. Skilled temps tend to be much more expensive. Technical or professional temps may cost up to $30 per hour.

Most firms offer discounts off their published rates. Even if you plan to use temporary services infrequently, it is usually worth negotiating rates upfront to reduce the overall cost.

Special Tips

Even if the temp agency will not give you an across-the-board discount for temporary help, you should negotiate rates for specific types of workers and jobs, such as those that require little skill.

Also, if temporary workers will be hired for a specific long-term project, see if you can provide training without being charged for their time.

Ask about guarantees from services for the workers they place. Reputable services generally guarantee satisfaction, waiving fees for workers who do not work out.

If security is of concern, see that the service is bonded to cover the theft or destruction of property by temporary workers.

Make sure to inquire about the cost of hiring a temporary for a permanent position before working with a service. Doing this ahead of time can put you in a much stronger position if you subsequently decide to permanently hire a temporary employee.

If you are looking for a temp agency in your area, you can contact the National Association of Temporary and Staffing Services (703/549-6287) for a listing of member agencies in your area.