Staffing Industry Glossary
Plain-English definitions of the terms the staffing industry uses every day - written for operators, owners, and buyers in the USA and Canada, with the operator angle generic dictionaries skip.
- ACSESSIndustry
- Association of Canadian Search, Employment and Staffing Services. The national trade association representing the Canadian staffing industry, providing advocacy, education, and industry data.
- Applicant Tracking System (ATS)Technology
- Software automating the recruiting process - job postings, resume collection, candidate screening, and pipeline tracking. Essential for staffing agencies handling high volumes.
- ASA (American Staffing Association)Industry
- The US staffing industry’s trade association: advocacy, legal resources, certification, quarterly surveys, and the weekly ASA Staffing Index used as a near-real-time demand indicator.
- Back OfficeOperations
- Payroll, invoicing, and reporting - everything after the hours are worked. Invoice lag here stretches the cash cycle; integration with the front office decides how much data gets re-keyed.
- Bench SalesServices
- Marketing consultants who are already on an agency’s payroll (the bench) to new client projects, common in IT staffing. Keeping the bench billable is the whole economics of the model.
- Bill RateFinance
- The hourly rate a staffing agency charges a client for a temporary worker. Includes pay rate, markup, employer taxes, workers comp, and overhead.
- Burden RateFinance
- The employment costs stacked on top of pay - payroll taxes, workers compensation, unemployment insurance, benefits - usually expressed as a percentage of pay. Burden is why a $20 pay rate can cost the agency $24+ before overhead.
- Co-employmentLegal
- Legal arrangement where both staffing agency and client share employer responsibilities. Agency handles payroll and taxes; client directs daily work.
- Contingent WorkforceIndustry
- Non-permanent workers including temps, contractors, freelancers, and gig workers. Approximately 40% of the workforce in developed economies.
- Contract StaffingServices
- Placing workers with a client for a defined period or project while the agency remains employer of record. The largest revenue category in US staffing, and the one that grows when uncertainty makes permanent hiring feel risky.
- Direct PlacementServices
- Recruiting candidates who are hired directly by the client as permanent employees. Fee is typically 15-25% of first-year salary.
- DSO (Days Sales Outstanding)Finance
- How many days cash takes to arrive after invoicing. Agencies pay workers weekly but collect in 30-60 days, so every DSO day is working capital the agency finances - the binding constraint on staffing growth.
- E-VerifyLegal
- The federal system for electronically confirming employment eligibility. Mandatory for federal contractors and in several states, and frequently required of staffing suppliers contractually by enterprise clients.
- Employer of Record (EOR)Legal
- The entity legally responsible for a worker: payroll, tax withholding, benefits, and compliance. In temporary staffing the agency is typically the EOR while the client directs the daily work.
- Fill RateMetrics
- Percentage of job orders successfully filled. Industry average is 60-80%. AI-powered platforms report 90%+ rates.
- Form I-9Legal
- The federal employment eligibility verification form every US hire must complete, with document inspection rules and retention requirements. In staffing, the employer of record - usually the agency - owns I-9 compliance.
- Front OfficeOperations
- The sales and recruiting side of staffing software and operations: CRM, job orders, candidate search, submittals, placements. Where revenue is created.
- GeofencingTechnology
- Location technology creating virtual boundaries around work sites. Workers can only clock in within the geofenced area, preventing time fraud.
- Gross MarginFinance
- Revenue minus the full cost of employing the worker (pay, payroll taxes, workers compensation, insurance). Temporary staffing gross margins commonly land at 15-25% of revenue; net margins are far thinner.
- Independent ContractorLegal
- Self-employed individual providing services under contract. Misclassification is a major compliance risk for staffing agencies.
- Job OrderOperations
- Formal request from a client to fill positions. Includes title, description, qualifications, pay rate, duration, and headcount.
- Light Industrial StaffingIndustry
- Placing workers in manufacturing, warehousing, distribution, and assembly. The largest US staffing segment by revenue.
- Locum TenensServices
- Temporary staffing for physicians and advanced practice providers covering gaps at hospitals and clinics. Arguably the strongest staffing sub-vertical of 2025, because provider shortages are structural rather than cyclical.
- Managed Service Provider (MSP)Services
- Third-party managing a client's contingent workforce program - vendor relationships, compliance, and spend management.
- MarkupFinance
- The percentage added to a worker’s pay rate to form the client bill rate, covering payroll taxes, workers compensation, insurance, overhead, and profit. Typical ranges run 25-75% by role and risk; the light industrial roles in StaffingPulse benchmarks run 38-45%.
- Middle OfficeOperations
- The operational layer between placement and payment: timekeeping, onboarding, credentialing, and compliance tracking. The classic home of unbilled hours and margin leaks.
- NAICS Code 561320Data
- Classification code for temporary help services. Used by BLS to track staffing industry employment and economics.
- OnboardingOperations
- Integrating new temp workers via digital workflows - e-signatures, document collection, compliance verification, and training via mobile app.
- Pay RateFinance
- Hourly wage paid to temp workers by the agency. Always lower than bill rate; difference is gross profit (typically 25-50% markup).
- PEO (Professional Employer Organization)Legal
- A co-employment arrangement where a PEO handles payroll, benefits, and HR compliance for a client’s own permanent employees. Unlike staffing, a PEO does not recruit or supply workers - it administers the ones the client already has.
- Per Diem StaffingServices
- Filling shifts day by day rather than for fixed assignment lengths, most common in healthcare. Commands higher hourly rates in exchange for zero schedule commitment.
- RedeploymentOperations
- Placing a worker into a new assignment as their current one ends instead of losing them to the market. Against roughly 376% annual temp turnover (ASA, 2025), redeployment is the largest controllable cost lever in staffing.
- Requisition (Req)Operations
- A client’s formal request to fill a position - the enterprise cousin of a job order, usually issued through a VMS with defined rate, location, and duration. Speed to first submittal on a req drives tier placement.
- Retained SearchServices
- Exclusive executive recruiting paid in stages - commonly a third at engagement, shortlist, and placement - typically 25-35% of first-year compensation. Contrast with contingency search, which pays only on placement at 15-25%.
- RPO (Recruitment Process Outsourcing)Services
- Employer outsources recruiting to a third-party who manages the full lifecycle from profiling to onboarding.
- SIA (Staffing Industry Analysts)Industry
- Global research and advisory firm for staffing. Founded 1989, produces 250+ reports annually across 80+ countries. A Crain Communications brand.
- SpreadFinance
- The dollar gap between bill rate and pay rate on an hourly placement - the raw material of staffing revenue before employment costs are paid. Recruiters on spread-based commission earn from this number.
- SubmittalOperations
- A candidate formally presented to a client against a job order. The submittal-to-placement ratio is a core quality metric: a worsening ratio means the desk is spraying rather than matching.
- Temp-to-PermServices
- Worker starts as temporary through the agency and may be offered permanent employment by the client after a trial period.
- Temporary StaffingServices
- Supplying workers on the agency’s payroll for short-term client needs, billed hourly. The core of the US staffing market: ASA counted $113.5 billion in temporary and contract sales for 2025.
- Time-to-FillMetrics
- Days between receiving a job order and a candidate starting. Industry average 5-10 days light industrial, 15-30 professional. AI platforms report 2-3 days.
- Vendor Management System (VMS)Technology
- Enterprise software managing contingent labor procurement - supplier management, job distribution, timekeeping, invoicing, reporting.
- Voice AI RecruiterTechnology
- AI system conducting automated phone screening 24/7. WurkNow's LUNA asks predetermined questions and creates detailed candidate profiles.
- Worker ClassificationLegal
- Legal determination of employee vs. independent contractor status. Misclassification can result in penalties, back taxes, and lawsuits.
- WurkNowTechnology
- AI-powered end-to-end staffing platform - ATS, onboarding, timekeeping, payroll, billing. Known for LUNA Voice AI and modular pricing.
Frequently asked questions
What is a staffing agency?
A staffing agency recruits, screens, and employs workers, then places them with client companies for a fee, typically billed as an hourly markup on the worker's pay or a percentage of first-year salary for permanent hires. The agency usually remains the legal employer of temporary workers, handling payroll, taxes, and workers compensation.
What is contract staffing?
Contract staffing places workers with a client for a defined period or project while the staffing agency remains the employer of record, handling payroll, taxes, and benefits. Clients pay an hourly bill rate. It is the largest revenue category in US staffing, and it grows fastest when economic uncertainty makes companies hesitant to add permanent headcount.
What is temp-to-hire staffing?
Temp-to-hire (or contract-to-hire) starts a worker on the staffing agency's payroll for a trial period, typically 90 days, after which the client can convert them to a permanent employee. Clients use it to evaluate real on-the-job performance before committing; agencies usually charge a reduced conversion fee if the hire happens after the trial.
What is direct hire recruiting?
Direct hire (or direct placement) means the staffing firm recruits a candidate who goes straight onto the client's payroll as a permanent employee. The agency charges a one-time fee, commonly 15-25% of first-year salary. Direct hire revenue is more cyclical than temporary staffing: it falls fastest in downturns and rebounds sharply, as Canada's forecast 14% place-and-search recovery in 2026 shows.
What is the difference between staffing and recruiting?
Recruiting is the activity of finding and evaluating candidates; staffing is the broader business of employing and supplying workers. A recruiting firm typically places permanent hires for a fee, while a staffing agency also acts as the employer of record for temporary and contract workers, carrying payroll, compliance, and workers compensation.
What is RPO in staffing?
RPO (recruitment process outsourcing) means a client hands all or part of its internal recruiting function to a provider, who manages sourcing, screening, and hiring under the client's brand, usually on a subscription or per-hire pricing model. It differs from staffing because RPO hires go onto the client's payroll.
What is MSP staffing?
An MSP (managed service provider) manages a company's entire contingent workforce program: multiple staffing suppliers, requisitions, rate cards, and compliance, usually operating through a VMS platform. Large enterprises use MSPs to consolidate dozens of staffing vendors under one accountable program.
What is VMS staffing?
A VMS (vendor management system) is the software platform through which enterprises manage staffing suppliers: distributing job orders, receiving candidates, approving timesheets, and paying invoices. If your agency sells to large accounts, VMS proficiency is a requirement, since orders and payments flow through it.
What is an employer of record (EOR)?
An employer of record is the entity legally responsible for a worker: payroll, tax withholding, benefits, and compliance. In temporary staffing, the agency is typically the EOR while the client directs the daily work. Standalone EOR services perform only the legal-employment function without recruiting.
What is light industrial staffing?
Light industrial staffing supplies workers for warehouses, manufacturing, logistics, and assembly: roles like warehouse associate, forklift operator, and machine operator. It is one of the largest staffing segments by headcount, is highly volume-driven, and in 2026 SIA sees its growth concentrating in construction and skilled trades.
What is locum tenens staffing?
Locum tenens is temporary staffing for physicians and advanced practice providers who fill coverage gaps at hospitals and clinics. It arguably had the strongest 2025 of any staffing sub-vertical, because physician shortages are structural rather than cyclical.
What is per diem staffing?
Per diem staffing fills shifts day by day rather than for a fixed assignment length, most commonly in healthcare, where facilities need nurses or aides for single shifts. It commands higher hourly rates in exchange for zero schedule commitment.
What is a staffing agency's fill rate?
Fill rate is the percentage of client job orders an agency successfully fills. It is one of the clearest performance measures in staffing: a falling fill rate signals sourcing problems or mispriced orders, and enterprise clients increasingly track it per supplier through their VMS.
What is time-to-fill in staffing?
Time-to-fill measures the days between receiving a job order and a worker starting. Light industrial roles commonly fill in 3-5 days, while specialized professional roles can take weeks. Speed is a primary reason clients pay staffing markups instead of hiring directly.
What is redeployment in staffing?
Redeployment means placing a worker into a new assignment as their current one ends, instead of losing them to the open market. High redeployment rates cut sourcing costs dramatically, which matters in an industry where annual temp turnover runs near 376% by ASA's count.
What is co-employment?
Co-employment describes the shared legal relationship where a staffing agency employs a worker while the client directs their daily work. Both parties carry obligations: the agency typically owns payroll, taxes, and workers compensation, while the client controls the worksite. Managing this split is a core staffing compliance discipline.