Close to 50 Million People Embraced Gig Work in the US in 2017, Surge in Gig Economies Fueling US IT Staffing Industry Revenue - Arizton


Leading market research firm, Arizton Advisory & Intelligence, has added a ground breaking research report, US IT Staffing Market- Industry Outlook and Forecast 2023-2028. This exclusive report encompasses major segments of the protein market, providing detailed insights, data-driven analysis and expert forecasts to help businesses stay ahead in the highly competitive industry. The cutting-edge research presents crucial information on market size, trends, key players and emerging opportunities. According to Arizton’s latest research report, the US IT staffing market will grow at a CAGR of 5.82% during 2022-2028. The U.S. IT staffing market was valued at USD 41.52 billion in 2022 and is expected to reach USD 58.31 billion by 2028.

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The IT staffing market continues to be an integral part of the overall staffing industry in the US. The trend of a rising contingent workforce driven by the need for scalability, flexibility, and minimized risk has been fueling the growth of the IT staffing market in recent years. The temporary staffing market remains positive due to consistent IT sector investments, economic stability, and technological advances. However, the growth of the IT staffing market in the US has been the increasing salary of personnel. The evolution of technology, the ever-growing demand for updated, secured, and quick IT solutions, and the shortage of skilled workforce push the demand for IT professionals across functions and departments. Although certain skill sets continue to observe sluggish growth in salary increases, some specific ones get paid off more than expected owing to high demand.

Major Factors Driving the US IT Staffing Industry Revenue

  • Digital Adoption Driving Transformation
  • Growing GIG & Freelance Economies
  • Referral Relevance for Staffing
  • Diversity & Data-Driven Recruitment

Digital Adoption Driving Transformation

The widespread adoption of digital technologies is acting as a catalyst for transformative changes across industries. As companies integrate digital tools and platforms into their operations, they gain the ability to streamline processes, enhance customer experiences, and improve efficiency. In the context of staffing, digital adoption is revolutionizing the recruitment process. Automated applicant tracking systems, AI-powered resume screening, and video interviews are becoming standard practices, allowing recruiters to manage high volumes of candidates effectively and make data-driven decisions.

Growing Gig & Freelance Economies

The rise of the gig and freelance economies signifies a shift in how work is organized and performed. Many professionals are opting for non-traditional work arrangements that offer flexibility and autonomy. This trend has significant implications for the staffing industry. Organizations are increasingly seeking short-term, specialized expertise to address specific projects and tasks. As a result, staffing agencies are evolving to connect clients with skilled freelancers and gig workers, providing businesses with access to a broader talent pool without committing to long-term employment contracts.

Over the last few years, one of the new growth factors for IT staffing firms has been the growth and expansion of freelancers and the gig economy. Firms hire freelancers who want to work on short-term contracts for single or multi-project associations to carry out specific tasks. Gig/contingent workers are hired for assignment-based, limited-duration tasks and released post-completion. The major driving factor for staffing firms in the US is the connection of the gig economy with web-based labor platforms. Close to 50 million people took up gig work in the US in 2017, pushing the total market value for gig economy spending to more than $800 billion. The numbers above are enough to highlight the implications of using gig workers for IT projects in the future. These workers bring added benefits such as a wide array of skills and the ability to be hired quickly and then relieved of their services as soon as the task gets completed. Although certain challenges, such as hiring the appropriate talent, were there previously, the new day business model in staffing allows the selection platforms to thoroughly scan the skills that a candidate (freelance/gig) will bring into the organization.

Referral Relevance for Staffing

Referrals have emerged as a powerful tool in the staffing industry. Employee referrals have gained prominence due to their effectiveness in sourcing qualified candidates. Existing employees recommend candidates from their networks, which often leads to better cultural fit and higher retention rates. Companies are incentivizing their employees to refer potential hires, creating a network effect that enhances the quality of candidates. Staffing agencies are also leveraging referrals to identify top talent and establish stronger relationships with both clients and candidates.

Diversity & Data-Driven Recruitment

Diversity and inclusion are increasingly recognized as crucial components of successful organizations. Companies are actively seeking diverse talent to bring a range of perspectives and ideas to the table. Data-driven recruitment strategies are being employed to remove bias from the hiring process. Analyzing data related to candidate sourcing, selection, and performance helps identify patterns and biases, allowing recruiters to make informed decisions. Leveraging data also enables the creation of targeted diversity initiatives and outreach efforts to ensure a more inclusive workforce.

These trends reflect the dynamic nature of the US IT staffing industry and the broader changes occurring in the world of work. As the digital landscape evolves, work arrangements diversify, and recruitment methods become more sophisticated, the US IT staffing industry continues to adapt to provide the best possible solutions for both clients and candidates.

California, Texas, Florida, New York, and Illinois are a few states that account for the highest number of small businesses in the US. These businesses are increasingly focusing on employee hiring and training. Hence, they are increasingly looking for ways to enhance their productivity and reduce the cost of operations to be highly competitive in the market. The above factors are expected to boost the country's IT staffing demand. The US has one of the finest connectivity infrastructures, and the country is witnessing increasing internet data traffic in recent years. Organizations are increasingly looking at various cloud-based services that can help them achieve their goals. Broadband usage in the country is growing rapidly. Moreover, the country now has 5G. All these factors are expected to drive the US IT Staffing Industry growth further as better internet speed will provide better cloud infrastructure. 

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Competitive Overview

The US IT staffing industry is a highly competitive and fragmented industry comprising large national and local staffing firms. The local firms are typically operator-owned, and each region generally has one or more significant competitors. Vendors in the market also face competition from national and regional accounting, consulting, advisory, national and regional strategic consulting, and systems implementation firms. Several factors, such as expanded reach within the US, physical presence in large markets, the concentration of service offerings in areas of most significant demand, and reputation in the market, all provide a competitive advantage. Vendors also face significant pricing pressure due to competitors’ pricing strategies.

With specialization being one of the key focus areas for vendors in the US IT staffing industry, major players concentrating on STEM skill sets continue to enjoy growth and profit. Apart from major players, a few mid-tier firms emphasize specializations across industries. Client industries such as tech/telecom, banking, financial services, and healthcare accounted for 61% of the recruitment and offered a strong and positive outlook during the forecast period. This is expected to draw the attention of market vendors looking to realign their business models in the future.

About the Report

The U.S. IT staffing market is provided for forecast years 2023 to 2028 and the base year of 2022. The market is segmented as skill set, end-user, and region for the years considered. The strengths and strategies undertaken by the players have also been mentioned. The report provides a holistic approach to the U.S. IT staffing market to enable customers efficiently analyze the industry.

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