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John Murphy
Bullish Year Expected for Staffing Industry

It has been a bullish year for the $100 billion staffing industry in the United States.

Publicly traded companies like Paychex (NASDAQ: PAYX), TrueBlue (NYSE: TBI), Robert Half International (NYSE: RHI), and ManpowerGroup (NYSE: MAN) have all done very well.  The need for temporary workers has increased very much due to the impact of The Great Recessions.  The growth plans and projections just issued by Labor SMART (OCTBB: LTNC) indicate that 2014 should be very good, too, for the industry.

Labor SMART operates in the $29 billion demand labor group of the staffing industry.  Its client list ranges from small businesses to Fortune 100 companies.  Business is booming for Labor SMART has it been registering record revenues in recent quarters.

To continue growing, Labor SMART is planning on adding 15 to 25 additional branches in new states in 2014.  It wants to double its finance facility in 2014, too.  As part of expanding efficiently, gross margins are expected to rise to 22%.   Labor SMART is already undervalued as its quarterly revenues are higher than its market capitalization.  For investors, that outlook for Labor SMART is very appealing.

The demand for the products and services of the staffing industry has risen due to The Great Recession and its aftermath.

Businesses are hesitant to hire full-time workers.  There is not strong confidence in the recovery in the American economy.   Due to the higher costs imposed by Obamacare, which requires firms with more than 50 workers to provide health insurance, there is even more of a preference for project employees.  That should continue to increase in the future.

While past performance does not guarantee future results, how well TrueBlue, Paychex, Robert Half and ManpowerGroup have all done is certainly a good indicator.  The recently released guidance from Labor SMART is nothing but bullish.  Investors should expect further gains for the staffing industry in the future.


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