Temp Agency Staffing Rates and Other Factors That Affect Temp Staffing Rates
Temp agencies have the resources to fill positions quickly, allowing your business to get the workers it needs. Temp agencies specialize in certain fields, making them more effective in their search for candidates. These agencies will also perform background checks and drug testing to ensure that you hire the right employees.
Temp agencies have the benefit of having a pool of candidates to choose from, which means you won’t have to waste time screening out unsuitable applicants. However, temp agencies have to be careful not to charge too much. Some temp agencies charge less than others, depending on the industry. For instance, an IT company might charge more than an orthopedic surgeon. Similarly, the cost of living in a particular region might determine the cost of hiring temp agency workers. The average markup rate for temp agencies is between 40 and 60 percent, though it can vary by location.
Temp agencies can also help businesses save money. For example, if a business is experiencing a slowdown, they can hire a temporary employee instead of hiring a full-time employee. This can save you time and money because you won’t have to spend hours recruiting and interviewing candidates. Temp agencies also take the responsibility of paying the temporary employee’s salary, ensuring they have adequate health insurance, and managing their payroll long-term. In some cases, a temp agency will even hire a full-time liaison to oversee the work done by their temporary employees. This means that you won’t have to hire someone full time to monitor their performance.
In addition to the money they charge for services, temp agencies also have to pay for worker’s compensation insurance, unemployment insurance, and health insurance. They also have to provide 401k benefits and paid vacation. These costs are typically not included in the temp agency markup rate.
Temporary employees can have their federal and state income tax withheld, which reduces the risk that they owe taxes next year. Employees also have federal Medicare and Social Security taxes deducted. There is also an additional markup based on the quality of the employee. This is calculated by subtracting the cost of hiring the employee from the bill rate. A good temp agency will be upfront with their fee structure.
Temp agencies also have a network of candidates to choose from, which means you may be able to find someone with the skills you need in a short amount of time. However, not all temp agencies will be able to fill positions in all industries. Temp agencies will only find qualified candidates for specific jobs. For instance, a retail store may need a part-time employee who has skills in a particular field, while an orthopedic surgeon may need someone with specialized experience for a project.
Temp agencies can also help businesses with short-term jobs. In some cases, a company may need to hire an accountant to assist with a merger, but the accountant needs to be a very skilled one. This could take weeks to hire a candidate, if the company were to do it on their own. Hiring a temp agency can help the company reduce this time to just a week.
