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While uncertainty lingers, growth for the staffing industry will remain challenged. In response, staffing companies may need to focus on capturing more market share by increasing their competitiveness and strengthening client relationships.
At the start of 2025 economic fundamentals appeared solid, so why the recent black cloud headlines forecasting doom? Government data still reflect a relatively robust economy, yet soft indicators are showing concerning trends. Is this negative sentiment an overreaction, akin to the recession fears of 2023–2024? Or is government data lagging behind shifting sentiment?
Both job growth and the unemployment rate have held steady so far this year, and the Federal Reserve claims the labor market is no longer a source of inflationary pressure. Inflation even ticked down in February, with the Consumer Price Index easing to 2.8% from 3.0% the month prior. However, the Fed noted that recent and anticipated changes in trade policy will likely delay progress on achieving price stability. Furthermore, the Fed noted an environment of low hiring and low firing persists within the labor market, and combined with uncertainty concerning the economic outlook it left interest rates unchanged this month. Such an environment creates challenges for the staffing industry which thrives on high turnover and labor demand.
The Consumer Sentiment Index from the University of Michigan fell to a value of 57.9 in March (lowest since November 2022) down from 64.7 in February. Additionally, the University of Michigan found that 66% of respondents believe unemployment will increase in the next year—the largest percentage recorded in the last decade. Underscoring these indicators the, the Economic Policy Uncertainty Index has rapidly increased both in the U.S. and around the world. The U.S. uncertainty index tripled from October 2024 to March 2025, from 109 to 335, while the global uncertainty index nearly doubled during the same period and is now equal to the value seen in May 2020.
While uncertainty lingers, growth for the staffing industry will remain challenged. In response, staffing companies may need to focus on capturing more market share by increasing their competitiveness and strengthening client relationships.
This still new technology clearly has the potential help workers be more efficient, but whether this will translate to increased productivity across the economy remains to be seen.
Since OpenAI officially launched ChatGPT in November 2022, the adoption of generative AI has grown rapidly, leaving many to wonder about the scope of its adoption and its actual impact on productivity. A recent working paper published by the Federal Reserve Bank of St. Louis uses data from a nationally representative survey of workers to measure the extent of generative AI use, and the time savings workers have experience.
Using a survey first launched in August 2024 and then rerun in November, researchers found that 28% of all workers use generative AI at work to some extent, including nine percent of U.S. workers reported using it every workday, and an additional 14% used it at least one day in the prior week.
How does this translate to time savings? On average, generative AI saved users 5.4% of work hours each week—or 2.2 hours assuming a 40-hour work week. Usage frequency and time savings were highly correlated and varied by industry. Workers in computer and math occupations used generative AI the most—in nearly 12% of their work hours—and saved 2.5% of their time, which was the highest of any occupation.
Generative AI is providing real time savings, particularly to the workers using it the most, though usage and resulting time savings vary by industry and role. This still new technology clearly has the potential to help workers be more efficient, but whether this will translate to increased productivity across the economy remains to be seen.
