What recent staffing data means for your workforce strategy

Every year, Staffing Industry Analysts (SIA) publishes its Staffing Trends report, giving us an unfiltered look at where the workforce solutions industry is heading. The last edition, the eighth in SIA's annual series, arrives at a pivotal moment: the industry is emerging from one of its sharpest downturns in recent memory, AI is an operational reality, and the contingent workforce is being redefined from the inside out. 

We spend a lot of time with this data. Not just because we track the market, but because our clients make real workforce decisions based on it. Here's what we're seeing in the numbers, what SIA's report and other market signals predict for the year ahead, and how it connects to what we hear from HR and procurement leaders every day. 

A market in recovery mode 

Let's start with the macro.  

Leading indicators throughout last year call for approximately 5% growth, targeting a market approaching $198 billion.  

A few key forces are driving this: 

• Improving demand in IT and professional services after an extended soft patch 
• Resumption of hiring activity in healthcare following the post-COVID correction 
• A broader client recognition that contingent labor offers strategic flexibility in uncertain times

For our clients, this recovery is a signal to act.

Key stats worth knowing 

Here's a snapshot of the numbers that are shaping conversations in every strategic sourcing division, HR department and procurement right now when it comes to talent: 

• Employee engagement: Gallup's State of the Global Workplace 2025 shares 21% global engagement, $438B productivity loss, 31% U.S. engagement (lowest since 2014), and 70% of team engagement tied to the manager 
• Career development and talent management: LinkedIn Workplace Learning Report 2025 shows 93% of employees are more likely to stay when employers invest in their development, only 24% of orgs have structured internal mobility programs, and 36% retention lift from AI-driven learning 
• Workforce wellbeing: Gallup (above): only 33% of workers are "thriving," 41% experience significant daily stress, and 25% of remote workers feel lonely  

What SIA's SWOT analysis tells us 

While the full report is available to SIA members only, the themes that emerge from publicly available commentary and SIA's broader research are consistent with what we see in the market: 

Strengths 

The staffing industry's core value propositions like workforce flexibility, speed-to-hire, compliance management and access to specialized talent remain as relevant as ever. In a period of macroeconomic uncertainty, the ability to scale talent up or down without the fixed costs of permanent headcount is genuinely valuable. 

Weaknesses 

The industry's structural challenge is margin compression and commoditization. As VMS platforms mature and buyers grow more sophisticated, the pressure on markup rates intensifies. Firms that haven't differentiated on service, specialization or technology are competing purely on price, an unwinnable race. 

Opportunities 

The explosion of Statement of Work (SOW) engagements, which now represent 39% of MSP spend, is one of the most significant structural shifts in contingent workforce management. Organizations are increasingly looking to managed outcomes, not just people. Staffing firms and MSPs that can deliver against SOW engagements are unlocking a growing share. 

Threats 

Artificial intelligence is the most complex force in the industry right now and is both a threat and an enabler. AI-powered sourcing, screening and matching tools are changing the economics of recruitment. But as ASA research notes, nearly half of employed job seekers believe AI recruiting tools are more biased than human recruiters, which creates real reputational risk if adoption outpaces governance. 

Regulatory complexity is also mounting. Algorithm auditing requirements, pay transparency law, and shifting worker classification rules are adding compliance burden for staffing firms and organizations alike. 

The AI conundrum 

No workforce trends piece is complete without addressing AI and the shift happening in staffing is real. AI has moved from pilot programs to embedded operations. 

Leading firms are using AI for candidate sourcing and screening, job matching, scheduling and compliance tracking. But the data also suggests the industry hasn't resolved the fundamental tension between automation efficiency and human trust. When candidates see AI hiring as less fair, firms that are transparent about their use and keep humans involved gain an edge in attracting talent. 

For enterprise buyers, the AI conversation is equally nuanced. Procurement leaders are asking us, ‘Are you governing it and how does it affect our compliance posture?'  

Where growth is coming from 

While the U.S. market dominates by volume, SIA's global data highlights some important directional signals: 

• Asia Pacific remains the strongest-performing region, with India, China, Vietnam, the Philippines and Indonesia all posting double-digit growth rates in 2024, with similar trajectories expected this year 
• The UK remains the largest staffing market in Europe, with a modest 3% growth projected 
• Southern Europe and Scandinavia are highlighted as increasingly attractive markets, benefiting from economic stability and growing demand for skilled workers 

For our clients with global programs, these dynamics matter. The regional variation in market maturity, regulatory environment, and talent availability means that a one-size-fits-all contingent workforce strategy is increasingly hard to sustain. 

What we’re telling clients 

Here’s how we're advising clients to think about their contingent workforce strategy in 2026: 

Reassess your SOW governance 

SOW engagements require different oversight than traditional staffing, requiring different performance metrics and different supplier relationships. 

Revisit your supplier tier structure 

If your supplier panel hasn't been refreshed recently, you may be missing access to specialized talent that's increasingly being sourced through emerging or boutique firms. 

Get ahead of AI governance 

Whether your partners are using AI in sourcing and screening or not, you should know. Build AI usage into your supplier qualification process and your governance framework before you need to. 

The bottom line 

The industry is recovering, but it's not returning to the pre-2023 model. The MSP space is more complex, talent platforms are more embedded, the regulatory environment is more demanding, and AI is reshaping economics. 

We think complexity is good news for clients who are willing to engage thoughtfully with it. The organizations that understand these trends (and build workforce strategies to match) will have a meaningful advantage in attracting talent, managing cost, and navigating what comes next. 

We're always happy to dig into these trends in the context of your specific program. Reach out to us today to start a conversation.