Welcome to this week’s StaffingHub Brief, your strategic intelligence roundup for staffing agency leaders. In this week’s issue:
- SIA’s new Staffing Confidence Index opened at 128.7 in its inaugural report, the highest reading since August 2022, the same week the real-time Bullhorn indicator showed commercial staffing hours turning negative year over year.
- More than 90% of organizations have deployed AI in talent acquisition, but fewer than 5% report transformational outcomes, and nearly 54% say AI-assisted candidate behavior is now making it harder to accurately assess candidates.
- More than half of active job seekers have run into what they believe were fake postings, the share actively hunting for a new role dropped from 42% to 35% in a year, and California’s executive order on AI-driven layoffs starts a 180-day compliance clock.
The new confidence benchmark debuted at its highest reading in four years
SIA launched its Staffing Confidence Index this week with an inaugural reading of 128.7, the highest since August 2022 and well above the post-pandemic steady state of roughly 114 that held from early 2023 through mid-2025. The index is built from SIA’s Pulse surveys going back to February 2020 and has a demonstrated statistical relationship with year-over-year staffing revenue six months out, making it a leading indicator rather than a coincident one. The Current Conditions Index reached 125 in June, with new orders at a net positive 45%, bill rates at a net 24%, and gross margins at a net 6%. SIA’s president Ursula Williams described June’s reading as showing “a marked increase in staffing executive confidence, but one that will require close monitoring in the months ahead.” (Learn more)
Year-over-year staffing employment declined 4.6% in Q1, compared to a 10.8% drop in Q1 2025, the smallest first-quarter year-over-year decline since Q4 2022. Total Q1 staffing sales reached $27.6 billion, down just 1.6% from Q1 2025, the narrowest year-over-year sales gap since 2023. ASA expects the industry to return to year-over-year growth in subsequent quarters of 2026, even accounting for ongoing economic uncertainty. “First quarter sales, payroll, and employment all recorded their smallest declines in years,” said Stephen Dwyer, ASA president and CEO. (Learn more)
Why it matters: For agencies that spent three years managing through consecutive industry contractions, the SIA index is the first benchmark with a demonstrated correlation to forward revenue, and its debut at a 4-year high is worth building into your planning cadence before the next reading in August.
Commercial staffing hours just turned negative year over year
Staffing hours were up 1% year over year in the week ended June 13, but the headline number masks a sharp shift. The SIA | Bullhorn Staffing Indicator flagged “a notable deceleration in commercial staffing year-over-year growth from the 7% growth rates observed during May.” Commercial staffing turned negative, down 1% year over year, while industrial held at +2%, professional staffing came in at +2%, and office/clerical was down 12%. Both commercial and professional segments pulled back from their May peak levels, and SIA flagged industrial hours for additional monitoring after a drop from roughly 9% year-over-year in late May to +2% by June 13. (Learn more)
Temp job orders fell month over month but remained 3% above their May 2025 level, so the 2026 gains haven’t fully unwound. In addition, fill rates declined for the first time this year in May. Permanent job orders dropped 7% month over month and fell 4% year over year. Perm fill rates held at 11% above last year, meaning recruiters are still executing on open roles, but new demand is coming in lighter. Bullhorn’s analysis points to inflation, geopolitical uncertainty tied to the ongoing Middle East conflict, and client hesitation on second-half headcount commitments as the pressure drivers. (Learn more)
Why it matters: There’s a lot of space between optimistic forward-looking confidence and current operational data. Firms viewing the market as uniform risk misallocating resources, especially as the sudden monthly shift in commercial staffing from +7% to -1% year-over-year exceeds typical seasonal fluctuations.
90% of companies use AI in hiring, but fewer than 5% are seeing it work
More than 90% of organizations have deployed AI in talent acquisition, but fewer than 5% report transformational outcomes, according to research commissioned by ManpowerGroup Talent Solutions. Nearly 40% report significant efficiency gains, with minimal improvement in hiring quality or workforce agility. More than half say AI-assisted candidate behavior, including AI-generated resumes and interview prep, is making it harder to accurately assess true candidate capability. The top barriers to scaling past task-level automation are change management and adoption challenges (58%), governance and compliance concerns (55%), and data readiness limitations (55%). (Learn more)
Most organizations are applying AI to isolated tasks rather than redesigning the processes that drive actual outcomes. When AI layers on top of a pre-AI workflow, it can speed up parts of the process while leaving the fundamental decisions, handoffs, and bottlenecks untouched. “Applying AI to individual tasks may create short-term efficiency, but meaningful value comes from redesigning entire workflows so intelligence is embedded where decisions are made, handoffs occur, and outcomes are shaped,” said Mahmoud Ramin, research director at Info-Tech. The firm’s blueprint outlines a three-phase process for moving from task automation to workflow redesign, and notes that organizations without cross-functional alignment on which processes to change first tend to end up with fragmented, incremental results. (Learn more)
Why it matters: Clients who announced AI hiring transformations in 2024 are now sitting on 90% adoption and sub-5% transformation, and agencies that walk in with placement quality data and verified screening outcomes can make a compelling case in the conversations those clients are now having with their boards.
Candidates are losing faith in the process right when clients need them most
Trust in the hiring process is breaking down. Recruiting solutions provider Employ surveyed 1,500 U.S. adults in March and April and found that more than half say they’ve run into postings they believe were scams, over a third feel they’re being filtered out by AI instead of a person, and almost a third say they’ve been ghosted. Openness to new opportunities dropped for the first time in three years, from 46% to 43%, and the share of adults actively job hunting fell from 42% to 35%. The share who call finding a new job “very difficult” climbed from 21% to 30% in a single year. Employ is calling the pattern the “Great Pause”: candidates have gone from cautious to closed off. (Learn more)
Monster’s research has documented what it calls doomjobbing, the practice of applying to large numbers of jobs in rapid succession with minimal vetting. More than four in 10 job seekers apply to four or more jobs per search session, nearly half admit they apply without reading the full job description, and 16% spend fewer than 30 seconds on a posting before submitting. “Candidates are applying faster and with less attention to detail, not because they want to, but because they feel they have to,” according to Monster’s analysis. The result is hiring teams facing higher volumes of less relevant submissions, making strong matches harder to surface. (Learn more)
Why it matters: When candidate trust is eroding and mass-applying is the norm, client hiring teams get more noise and fewer real matches, which gives staffing firms that verify fit before submitting a concrete advantage their clients’ own processes have lost.
California starts a 180-day countdown on AI layoff compliance
Gov. Gavin Newsom signed an executive order directing multiple California state agencies to study AI’s impact on the labor market, setting a 180-day clock for recommendations to revise the state’s WARN Act. A companion bill, Senate Bill 951, would require 90 days’ notice for AI- or automation-driven layoffs (30 days more than current WARN requirements), lower the trigger threshold to 25 workers or 25% of the workforce (currently 50 employees), require employers to flag hiring freezes tied to AI, and give displaced workers the right to bid on open positions. Connecticut and New York have already amended their WARN laws to require layoff notice when AI drives workforce changes. Employment attorneys at Ogletree describe LWDA’s 180-day assignment as designed to make Cal-WARN more responsive to AI-driven workforce changes. (Learn more)
California also launched its AI-Unemployment Tracker this week, a monthly dashboard that pulls from state unemployment insurance records to monitor AI-related job displacement by sector, region, and education level. Initial data shows no evidence of large-scale AI-driven layoffs statewide, but claims from college-educated workers in high-AI-exposure occupations have run elevated since the release of ChatGPT 3.5 in late 2022. “Right now, we are not seeing evidence of large-scale AI-related layoffs in California’s labor market,” said Ben Hyman, co-author of the tool. “But we do see patterns in certain regions like the Bay Area, in certain tech-heavy sectors, and among highly AI-exposed workers with college degrees.” (Learn more)
iCIMS data for May shows US job openings were 9% higher year over year, while application volume dropped 11% year over year. Tech hiring is redistributing across sectors: healthcare increased tech hiring 8% year over year as it scales digital operations, manufacturing is up 4% as smart factory investment accelerates, and finance is down 22% as firms focus on optimizing existing systems rather than building new ones. For staffing firms in the technology vertical, demand is shifting away from traditional tech employers and toward industries that historically haven’t needed deep technical staffing relationships. (Learn more)
Why it matters: California’s order is the early stage of a legislative pattern that Connecticut and New York have already set, and agencies supporting clients in any AI-driven workforce restructuring have 180 days to audit their WARN Act readiness before the recommendations land.
The StaffingHub Brief provides weekly insights for staffing agency leaders and publishes every Friday.
