Surge in temp jobs good news for the market

U.S. temporary staffing — historically one of the first areas to show evidence of a jobs recovery — surged in October, adding about 34,000 jobs in a positive sign for the overall economy.

Unemployment rose to 10.2 percent in October from 9.8 percent in September, but the spike in temporary help payrolls is reason for optimism, said Scot Melland, chief executive of Dice Holdings Inc., which operates Web-based job boards.

“Psychologically, this is a tough one,” Melland said. “But if companies are increasing their use of temporary services, that is a good sign for the coming months.”

Dice Holdings saw a third-quarter increase in technology and engineering employers searching its resume database, in addition to a spike in the number of job postings in the New York and Silicon Valley tech markets, Melland said.

Other good signs

Another area of strength was manufacturing and logistics, said Roy Krause, head of Spherion Corp., one of the largest U.S. temporary staffing companies.

“If we can sustain the growth of temporary numbers,” said Krause, “we should see the negative change in job numbers get smaller and eventually turn positive.”