This isn’t just a tough quarter. It’s a tipping point.
According to the American Staffing Association, temporary and contract staffing jobs dropped by 195,000 per week in Q1 2025. Sales fell 10.8% year over year to $28.1 billion. It’s one of the steepest drops the industry has seen since the Great Recession.
But unlike that downturn, this one isn’t just about economic contraction.
This is different.
This is structural.
A sales climate unlike any before?
We’ve heard it from clients across sectors: sales pipelines are drying up. Orders are being canceled — not because there’s no demand, but because clients are facing new challenges you can’t solve with more bodies alone.
In one recent example, a client lost a major order when their buyer couldn’t source key raw materials due to global supply chain constraints. It had nothing to do with talent availability or pay rates. It had everything to do with a complex, interconnected business environment that’s reshaping how companies think about labor.
And while labor shortages persist in many areas, employers are becoming more cautious, more selective, and more focused on outcomes, not just activity.
This isn’t just a downturn.
Here’s what’s really going on:
- Global instability and economic uncertainty are making clients hesitant to invest in project work and contract staff.
- Supply chain fragility is disrupting production schedules and canceling staffing needs altogether.
- AI and automation are accelerating the commoditization of transactional work and reducing the amount of labor (blue and white collar) needed.
- Gig platforms and online marketplaces are pressuring staffing firms to compete on price, not value.
These aren’t passing headwinds. They’re systemic shifts.
And they demand systemic change in how your firm goes to market.
Old playbooks don’t work in a rewritten market.
If your sales team is still leading with “we can get you better people,” you're already behind.
Clients aren’t looking for staffing vendors. They’re looking for strategic solutions to workforce challenges. They want partners who help them solve problems—not just fill requisitions.
The value proposition of “fast, flexible staffing” is no longer enough. It’s the baseline.
To win in 2025 and beyond, you need to move up the value chain.
The future staffing model: value over volume.
What does it look like to evolve your business model? Here are five opportunities:
1. Rethink Staffing as a Service
Clients don’t just need talent, they need outcomes.
Example: A commercial staffing firm that manages an entire production line for a manufacturing company. They own scheduling, performance metrics, and results…not just timecards.
This is staffing as a managed service.
2. Become a Recruiting Solutions Partner
Add RPO-lite offerings, recruitment marketing, and employer branding to help clients attract and retain the right talent.
Example: A healthcare staffing firm that runs local brand awareness campaigns and builds job landing pages for rural hospitals struggling with nurse recruitment.
They’re no longer just a staffing provider…they’re a strategic partner in workforce attraction.
3. Offer Global + Agentic Talent Supply
There’s a growing market for remote-ready, global talent and AI-assisted labor.
Whether it’s sourcing from Asia, Africa, or Latin America…or using agentic AI to support customer service, forward-thinking firms are creating hybrid benches of human + digital workers.
4. Shift to Outcome-Based Pricing
Instead of selling hours, sell results.
Imagine this: your firm doesn’t just supply warehouse labor; you guarantee that X number of packages get packed and shipped each day. You’re not a vendor anymore. You’re a performance partner.
5. Help Clients Navigate Complexity
The more complex the workforce gets, the more valuable your strategic advice becomes. From compliance and DEI consulting to workforce planning and automation readiness, there’s an opportunity for consultative services beyond placements.
What got you here won’t get you there.
Yes, this market is tough. And no, it won’t go back to “normal.”
But that’s not a reason to panic. It’s a reason to reinvent.
The firms that win in 2025–2026 won’t be the biggest. They’ll be the most adaptable: willing to rethink how they create value, how they sell, and how they help clients succeed.
Want help rethinking your value proposition?
If you're ready to explore new business models, create higher-value offerings, or train your team to sell more strategically, let’s talk.
We’re working with staffing firms right now to reimagine their growth playbook, and we’d love to help you do the same. |
