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The Rise of the Temp and Freelance Employment Market

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By Ryan Stenvick

Vice President of Business Development and Delivery, North America

With unemployment claims falling in recent weeks, the employment market has shown promising signs of making a comeback in the early stages of 2021. As the U.S. unemployment rate fell from 6.7% in December to 6.3% in January, candidates have slowly begun to find their footing in the new job market.

Upon taking a closer look at data from recent reports published by Staffing Industry Analysts (SIA), the results showcase a new kind of employment market taking root. According to one study, SIA observed that the number of U.S. temp jobs rose by 80,900 in January. Another finding revealed that jobs on the online staffing platform rose by 17% in 2020.

But what do these reports really mean, and what can they tell us about where the labor market is heading in 2021?

Contract labor is alive and well

As business needs begin to normalize, so too will the demand for labor. But don’t expect companies to immediately begin hiring an abundance of full-time workers. According to labor and employment market experts, many organizations have come to terms with the tremendous benefits of utilizing a larger population of contingent workers. Rather than weighing their budgets down with FTEs at high salaries, companies will be more inclined to bring in a temporary employee on a project or assignment basis. Look for contract labor to continue its steady rise in 2021.

Confidence in the gig economy

In addition to greater opportunity for temporary workers, freelancers have also looked to capitalize on the current market conditions. While the pandemic has fueled significant growth in the gig economy, freelancers anticipate this trend to continue over the coming months—particularly in tech fields. Specialists like application, website, and full-stack developers will benefit from increased flexibility while being able to work from the comfort of their own homes.

Back to school, back to work

The rising trend of working-class parents—particularly women—who were forced to leave the workforce and devote themselves to caring for their at-home children has been well-documented throughout the past year. According to a report by HR Dive, the pandemic caused one in four women to consider quitting their jobs entirely to the burdens of childcare. As schools and daycares begin to normalize operations in the months ahead, these women will see greater opportunity to return to work and reverse the damage caused by this women’s recession.

A resurgence in hospitality employment

As the COVID-19 vaccine has proven to be successful in the early going, its continued efficacy will have huge implications on the leisure and hospitality industry. Over the coming months, the number of vaccinated Americans will continue to climb—leading to the easing of social distancing restrictions and the return of recreational activities. As restaurants, bars, and other staples within the hospitality industry begin to reopen at a greater capacity, the demand for these workers will begin to explode.


As early indications point to a strong recovery in the labor market, experts believe that the temporary and gig economies will see continued growth in 2021. Despite some remaining volatility in the U.S. workforce, the effectiveness of the COVID-19 vaccine will be a critical component of quelling labor market concerns and providing new job opportunities to hardworking Americans.

Is your organization looking to bolster its population of contingent workers? Acara’s expert recruitment teams can connect you with hundreds of qualified temporary candidates to help tackle pressing labor needs. Contact us today to learn more about how we can help scale your organization’s workforce in no time.

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