A seasonal slowdown in hiring led temporary and contract staffing employment to fall 7.5 percent, or 154,000 jobs, from the fourth quarter of 2025 to the first quarter of 2026, according to data from the American Staffing Association (ASA). On a quarter-to-quarter basis, temporary and contract staffing employment and sales typically decline in the first quarter, grow in subsequent quarters and peak in the fourth quarter. While the first quarter of 2026 aligned with this pattern, it marked the slowest first-quarter rate of decline since 2022.
The year-over-year decline in total staffing employment narrowed to 4.6 percent in the first quarter, marking a substantial improvement from the 10.8 percent drop recorded in the first quarter of 2025, and the slowest year-over-year decline since the fourth quarter of 2022.
Staffing sales also reported narrower declines. In the first quarter of 2026, staffing sales dropped 4.3 percent from the fourth quarter of 2025 to a total of $27.6 billion. However, the 1.6 percent decline from the first quarter of 2025 represents the smallest first-quarter year-over-year decline since 2022 and the narrowest year-over-year gap since 2023.
“In the face of significant economic uncertainty, the staffing industry is showing further signs of stabilization,” said Stephen Dwyer, ASA president and chief executive officer. “First quarter sales, payroll and employment all recorded their smallest declines in years, providing reasons for optimism for the remainder of the year.”
He noted the industry is continuing to adjust and position itself for future growth by providing a vital service that matches candidates with clients, especially during a time of historically low hiring, when many job seekers are finding it difficult to secure employment.
