Material Handling: 10 Reasons To Outsource Temporary Labor

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10 Reasons to Outsource Temporary Labor




TradeDesk, Inc.




















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About Temporary Employees

What is a temporary worker?

According to the US Dept. of Labor, temporary employees work with a company for a year or less with a specific expiration date on their employment. (1) These employees are eligible for some but not all of the benefits and protections as permanent workers. They are technically employed by a temporary staffing firm and contracted to the company where they actually work.


How many temporary employees are out there?

Temporary employment is becoming a fast growing trend in business across all industries but specifically in the industrial sector. A report by the US Dept. of Commerce states that almost 3 million employees were temporary in May of 2015, which was an all-time high (2). In past decades, most temporary workers were clerical, but the manufacturing and warehousing industries have seen a great upswing in the number of temporary workers.


Part of this can be explained by a rise in using temporary labor in general, but there are plenty of reasons why hiring temporary staff is important for the material handling industry specifically, like flexibility and cost.


Are there many temporary workers in material handling?

According to The Bureau of Labor Statistics’ Occupational Employment Statistics (OES) Report, 24% of all temporary employees work in “transportation and material moving” (2). Other industrial occupations topped the list as well, with office jobs ranking lower. US Department of Commerce statistics showed that in 2012, the warehousing and storage industry alone spent 19% of its payroll on temporary workers, making it the fourth highest spending industry (2). These numbers alone tell us that supply chain and material handling are the fastest growing industries for temporary workers.


Temporary workers: A rising trend that’s here to stay.

Clearly, outsourcing temporary staff is a growing trend in the material handling industry, as statistics show that more temporary workers are in industrial and warehousing than in previous years. It’s no wonder that smart material handling companies are jumping on the temporary worker bandwagon. Hiring temp workers makes sense for an industry which needs flexibility, reliability, and efficiency.


The Problem: Permanent Employees Don’t Make Sense

In the supply chain industry, things are always changing to keep up with business needs. Workers like forklift operators, material movers, and drivers are no exception, and businesses that hire these types of workers need flexible and low-cost staffing. Some would argue that permanent employees are the standard, so why would you need temporary material handling staff? There are several reasons why permanent employees don’t make sense in material handling specifically, but ultimately it comes down to lack of flexibility and costs in both time and money.




Lack of Flexibility

When your business depends so heavily on the pace of other industries like retail or manufacturing, you need to be able to respond quickly to fluctuating needs. It’s harder to do this when you have the same number of workers doing the same work. Sure, permanent workers are stable and you can count on a base level of work getting done, but is that good enough? There are a ton of scenarios where you’d need more or different workers, such as growing your business, seasonal fluctuations, employees leaving, or special projects.


The Hiring Process for a Permanent Employee

Let’s go through the typical hiring process for a permanent employee to better understand the problems with hiring permanent employees for material handling positions.


p<>{color:#000;}. First you have to prepare recruiting materials such as advertisements or posts on job boards. While this can be an HR task, it still takes time.


p<>{color:#000;}. Then you need to spend man-hours on actual recruiting, either by looking online or physically. HR employees spend time monitoring posts on online job boards and responding to applicants’ emails. Physical recruiting includes going to job fairs or presenting at schools.


p<>{color:#000;}. Once you’ve found your applicants, you have to take time combing through resumes and sending emails back and forth between HR and the managers overseeing that position to check if an applicant is a good fit.


p<>{color:#000;}. The actual candidate interviews for positions can take up a whole day for both HR staff and department managers. HR also must run employment and drug screenings after interviews.


p<>{color:#000;}. After you’ve made your selection, the permanent hiring process can speed up a little, but you still need to perform necessary onboarding tasks like going through benefits packages with the new employees, confirming licenses, and signing legal employment paperwork.


p<>{color:#000;}. When the whole hiring process is complete, you still need to take time to train the employee in their actual job and get them up to speed with the overall production.


When you break it down like this, it’s clear that every stage of the hiring process for a permanent employee costs you time and money.



Hiring a permanent worker can take several weeks if not months from the time you realize you need the worker until the time they’re in your warehouse or driving your truck. Finding good candidates, interviewing and screening these candidates, and then training them is a process that keeps positions open for a long time. Every day that a position goes unfilled is a day that production is lost.


The time costs don’t stop once a worker is hired permanently, either, as you are required to give them weeks of leave and paid vacation, leaving positions open even though you have someone hired. If there are disagreements with an employee, you can also have an open position while negotiating severance or extended leave.


Monetary Costs

Finding and onboarding this permanent employee also costs you money at every step of the hiring process from recruiting to training, because you need to have the HR staff to hire and train. Remember of course that you have to pay that HR staff too. There can also be tons of hidden costs to hiring permanent employees, like background checks and federal employment verification fees.


Once hired, permanent employees also cost more because their wages are generally higher, and you have to pay out benefits. There are also federal employment costs like worker’s compensation and employment taxes. When a permanent worker leaves the company, you might also have to pay a severance package.


As you can see, there can be lots of problems with hiring permanent employees in the material handling industry. Now let’s look at why it might be a good idea for your business to outsource temporary staff.


10 Reasons To Outsource Temporary Labor

Now that we’ve seen some of the potential problems with keeping permanent employees, let’s look at the ROI associated with temporary employees. Why would you want to hire temporary staff for your material handling positions?


p<>{color:#000;}. Save money. – Staffing agencies cover many of the HR costs associated with new employees, like benefits, workers’ compensation, and screening. You also save at the end of employment; as temporary workers generally aren’t paid severance packages. A temporary employee is technically employed by their staffing agency, so the agency floats those costs and passes the savings to you. This is the number one reason companies use temporary workers, but it’s far from the only reason.


p<>{color:#000;}. Save time (which is also money). – Running a recruiting campaign, interviewing, screening, and then training new employees is a long process, and that means weeks may go by with an unfilled position. A temporary staffing agency can do all this for you, and save you tons of time, which also means less time without that valuable work getting done. Many times, they’ve already prescreened potential employees for you, so it takes no time to come up with the perfect candidate. Temporary staffing agents are also experts in onboarding and training employees quickly.


p<>{color:#000;}. Save yourself some headaches – A temporary staffing agency is focused on hiring and onboarding new employees, while your business is focused on moving materials. Let the agency use their expertise, and you can focus on what you do best. They can navigate federal employment laws, health care requirements, and all the other technical aspects of hiring and keeping employees.



p<>{color:#000;}. Increase productivity. – When you bring in temporary workers, you spread the work better among all employees, leading to better productivity. For example, an employee working on the tail end of a 12-hour shift will make more mistakes than a fresh employee. With temporary staffing you can hire that extra worker to take the load off.


p<>{color:#000;}. Be more flexible. – With temporary workers, you can better respond to the ups and downs of your market, whether that’s because of seasonal demand or company growth. For example, you can get more forklift drivers as holiday sales ramp up, or you can hire more warehouse workers if your business is growing without worrying about letting them go if the economy falters again.


p<>{color:#000;}. Keep positions filled. – It’s a sad fact that some workers call in sick or just don’t show up for a shift, and you have to fire them. With temporary staffing, your agency can help you fill that empty position quickly. Temp agencies will also hire someone new for an open job if their own temporary employee doesn’t work out, so you’re never left short staffed again.


p<>{color:#000;}. Find the perfect fit. – Not every worker is perfect for every job, but you can ‘try out’ employees by hiring them as temporary workers. The option to hire permanently is always there when you feel like they’re the right fit. Outsourcing temporary staffing allows you to find the best person for each position.


p<>{color:#000;}. Create the perfect worker. – Many times temporary workers are newly graduated from school and are looking for experience in the field. By hiring them, you can provide these ambitious workers with the experience they need while also molding the perfect employee for the job.


p<>{color:#000;}. Take on more special projects. – If you get the opportunity for a new project but don’t want to pull any of your permanent employees away from their duties, you can hire temporary workers just for that opportunity. This way you don’t miss out on a special project for fear of not having enough staff to complete it.


p<>{color:#000;}. Help your permanent employees out. – If a regular employee goes on maternity or sick leave, you can easily get a temporary worker to fill their position for a little while. This increases employee morale too because you’re more likely to allow vacations and leave when you know you can cover the work with a temporary employee.


As you can see, a cost/benefits analysis of temporary workers shows that they can help you run and grow your material handling business more efficiently. When you outsource temporary staff, you make your business more flexible, avoid additional HR costs, and get the right person for the job. Let us help you get all these benefits of temporary employees.








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p<>{color:#000;}. US Department of Labor; “Temporary Employees” – https://www.dol.gov/oasam/doljobs/tempemployees.htm


p<>{color:#000;}. US Department of Commerce, Economics & Statistics Administration, Jessica R Nicholson; “Temporary Help Workers in the U.S. Labor Market” – http://www.esa.doc.gov/sites/default/files/temporary-help-workers-in-the-us-labor-market.pdf

[+ http://www.esa.doc.gov/sites/default/files/temporary-help-workers-in-the-us-labor-market.pdf+]










Material Handling: 10 Reasons To Outsource Temporary Labor

★ Get The Right Staff To Grow Your Business! ★ What if finding reliable, motivated, and highly qualified employees DIDN'T have to be so difficult? Imagine if you could have instant access to effective labor on demand. Built on over 20 years of the leading best practices of the industry, TradeDesk is the BEST solution for businesses and recruiting specialists who are looking to dramatically increase their efficiency and performance in finding great employees. In This Book, You Will Learn... - Exactly How Outsourced Labor Works - The Shocking Truth About Permanent Employees - Compelling Stats About The Changing Job Market - The 10 Reasons Why You Need To Outsource Temporary Labor - BONUS: Instant FREE Access To Our Employee Database (Over 35,000 Job Seekers!) Download this book TODAY if you're serious about bringing your business to the next level by outsourcing your staff. Pick up your FREE copy now by clicking the BUY NOW button at the top of this page!

  • ISBN: 9781370711499
  • Author: TradeDesk
  • Published: 2016-08-31 17:50:09
  • Words: 2012
Material Handling: 10 Reasons To Outsource Temporary Labor Material Handling: 10 Reasons To Outsource Temporary Labor