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Highlights

1. The employment services industry experienced strong growth in 2006, with operating revenue increasing by 8.6% to $8.0 billion as employment placement and staffing agencies benefited from a tighter labour market and strong economy particularly in Western Canada. This follows substantial operating revenue increases of 18.1% in 2005 and 10.2% in 2004.
2. The growth in operating revenue was particularly strong west of Ontario, with Manitoba (+15%), Saskatchewan (+28%), Alberta (+25%), and British Columbia (+19%) reflecting large increases over 2005, while growth in Quebec (+4%) and Ontario (+4%) was much lower during this period.
3. While Ontario continues to dominate industry operating revenue with a 56.9% share of the national industry in 2006, its share has declined from 62.1% in 2001. During the same period, British Columbia saw its share increase from 4.9% to 7.1%, and Alberta's share grew from 13.4% to 17.6% overtaking Quebec in 2006 to move into second place nationally.
4. In 2006 the industry's operating expenses grew by 8.8% resulting in a slight decline in operating profit margin from 3.7% in 2005 to 3.5%. Salaries, wages and benefits of employees increased by 7.1% and accounted for 73% of the total operating expenses.
5. For the industry as a whole in 2006, fully 70% of sales were generated from temporary staffing services, with 28% from permanent placement and contract staffing services, and the remaining 2% from other goods and services. While temporary staffing services still dominate the industry, their share of sales has declined from 77% in 2005, while over the same period there has been a significant growth from 22% to 28% from permanent placement and contract staffing services.
6. Consistent with prior years, in 2006 the vast majority (87%) of industry sales were made to the business sector, with the government and public institutions sector following at 11%, and the remaining 2% accounted for by individuals and households, and clients outside Canada.
7. This is a stable industry dominated by a small number of large businesses. In 2006 the 20 largest firms generated 39% of total industry operating revenue, down slightly from 40% in 2005, with their operating profit margin of 3.4% being slightly lower than the overall industry average of 3.5%.