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Here Are 3 Staffing Stocks to Consider Despite Industry Challenges
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The Staffing Firms industry is being restructured by AI-driven hiring, consistent skill shortages and flexible workforce demand, creating opportunities for specialized recruitment despite economic headwinds and technology-backed disintermediation risks.
The Zacks Staffing industry is a diverse sector encompassing companies that offer a comprehensive range of human resources and workforce solutions. These services cover various aspects of personnel management, including employment screening, recruitment services for both temporary and long-term job placements, retirement planning, human capital management, payroll administration, performance evaluation, organizational planning, and financial management. Some firms within this industry provide specialized services, such as staffing and risk consulting, professional staffing, and global business solutions tailored to the needs of small to medium-sized enterprises. They also offer organizational consulting services with a worldwide reach, catering to a vast and varied client base, which includes domestic and international businesses across different sectors and industries.
What's Shaping the Future of the Staffing Firms Industry?
AI Adoption & Inclination Toward Skills-Based Hiring: AI is moving the needle between what clients hire for and how staffing firms recruit. Rising demand for AI, data, cybersecurity and other specialized skills is met with recruiters leveraging AI for sourcing, screening and candidate matching. A recent ManpowerGroup report mentioned that 72% of global employers are facing difficulty in filling roles, with AI skills becoming the hardest capabilities to find. A Korn Ferry published last year stated that 84% of talent leaders strategize to leverage AI in 2026, hinting at how rapidly technology is becoming embedded in recruiting workflows. While staffing firms can supply scarce technology talent and enhance recruiter productivity via automation, this raises the risks of disintermediation as clients utilize AI tools directly.
Demand Upsurge in Specialized Staffing Amid Skill Shortages: Companies continued to struggle to find workers with the right skills despite greater candidate availability. Per a Robert Half report, 58% of business leaders remark that finding skilled professionals has become harder than a year ago, while 67% are highly likely to seek staffing firms’ assistance. The same report suggests that among technology employers, 65% report hindrance in finding skilled talent and shortages have resulted in project delays for 71% of respondents. The shortage is experienced in capabilities rather than headcount. A ManpowerGroup reportsuggests that 62% of employers planning to expand staffing cite changing roles and skills as the primary reason, highlighting rising demand for expertise introduced by technology and business-model transformation. Staffing companies will grab this opportunity to identify and validate scarce talent.
Economic State & Dynamic Workforce Demand: Staffing remains sensitive to the economic cycle because employers typically adjust temporary and contract hiring before making commitments to permanent workforce. The Bureau of Labor Statisticsstated that U.S. temporary-help employment reached 2.52 million in August 2026, rising from 2.48 million earlier in the year. Per an American Staffing Association report, staffing employment in September was 3.3% above the year-ago level and moved up marginally from its August reading.
Zacks Industry Rank Indicates Sluggish Near-Term Prospects
The Zacks Staffing Firms industry, which is housed within the broader Zacks Business Services sector, currently carries a Zacks Industry Rank #192. This rank places it in the bottom 22% of the 247 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all member stocks, indicates a continued outperformance in the near term. Our research shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
Before we present a few stocks that you may want to consider for your portfolio, let us look at the industry’s recent stock market performance and current valuation.
Industry Beats Sector & S&P 500
Over the past year, the Zacks Staffing Firms industry has outperformed the broader sector and the S&P 500.
The industry has risen 22.7%, whereas the broader sector fell 20.2% and the S&P 500 composite has returned 18.7% over the same period.
1-Year Price Performance
Industry's Current Valuation
Based on EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation and amortization), which is commonly used to value staffing stocks, given their high debt levels, the industry is currently trading at 8.76X compared with the S&P 500’s 17.94X and the sector’s 10.27X.
Over the past five years, the industry has traded as high as 10.64X and as low as 4.37X, with the median being 7.39X, as the charts below show.
EV-to-EBITDA
3 Staffing Stocks Poised for Growth
We have presented three stocks that are expected to grow in the near term.
RCM Technologies: This business and technology solutions provider delivered solid second-quarter 2026 performance, with the top line rising 20% year over year and gross profit rising 8.1%. The quarter remained profitable as net income advanced 29.5%. Importantly, selling, general and administrative (SG&A) expenses registered a modest uptick despite a sharp top-line upswing, underscoring improving operational prowess and scalability of RCMT’s cost structure.
The Engineering segment remained the primary growth driver, with revenues increasing nearly 49% year over year. This growth is driven by stronger Energy Services activity, mainly Engineering, Procurement and Construction Management projects. These large-scale project activities support RCMT’s Engineering segment’s growth while strengthening customer relationships.
The top-line expansion and operational enhancement translated into robust earnings growth. In the second quarter of 2026, adjusted earnings per share (EPS) gained 18.8% year over year. Adjusted EBITDA registered a 14.8% year-over-year increase during the aforementioned quarter, resulting in 9.9% growth in the first half of the year, implying that earnings momentum persists beyond a single quarter.
RCM Technologies’ cash improved to $6.6 million from $2.9 million at the beginning of the year, amid debt repayments and share repurchases. An improved cash generation enhances RCMT’s flexibility to invest in recruiting, expanding sales capabilities and chasing growth opportunities, while also returning capital to shareholders.
RCMT currently flaunts a Zacks Rank of 1 (Strong Buy). The Zacks Consensus Estimate for 2026 EPS has been flat at $3.07 over the past 30 days. The company’s shares have skyrocketed 109.2% over the past six months.
TrueBlue: This specialized workforce and recruitment solutions company registered 12% year-over-year growth in its top line in the second quarter of 2026. TrueBlue’s skilled businesses remained the primary growth engine, delivering double-digit revenue growth for the fifth consecutive quarter. PeopleReady revenues gained 23% year over year, fueled by the energy vertical. The commercial driver business also registered its 10th consecutive quarter of growth.
TrueBlue’s partnerships and cross-selling initiatives are broadening its sales reach and introducing additional client channels. Previously announced partnership wins began converting into revenues during the quarter, while the multi-brand pipeline presents additional opportunities for growth. The U.K. Armed Forces engagement is increasing and is anticipated to achieve its full value in 2027, providing additional revenue visibility. TBI secured a new deal with a large battery storage provider, demonstrating sustained momentum in one of its fastest-growing verticals.
TrueBlue’s top-line translated into improved profitability through prudent cost-management and technology-enabled operational efficiency. In the second quarter of 2026, SG&A expenses dipped 7% year over year despite double-digit top-line growth. Adjusted EBITDA registered a lofty increase to $11 million from the year-ago quarter’s $3 million, while adjusted net income recovered to $2 million from the year-ago quarter’s $2-million loss. Margins of PeopleReady, PeopleManagement and PeopleSolutions improved 260, 60 and 510 basis points, respectively, demonstrating scalability of the company’s operating model.
TBI currently carries a Zacks Rank of 2 (Buy). The Zacks Consensus Estimate for 2026 EPS has been unchanged at 6 cents over the past 30 days. The company’s shares have escalated 150.4% over the past six months.
Price and Consensus: TBI
HireQuest: This staffing, recruiting and workforce solutions franchisor’s ongoing operations began the second quarter of 2026 with year-over-year growth of 2-4%, which increased to 12-13% in some weeks toward the end of the quarter. Importantly, improving demand conditions through the first six weeks of the third quarter provide evidence that the company held on to the growth momentum.
HireQuest noted tangible growth opportunities and incremental customer wins from investments in HQI’s national accounts program. It is successful at creating a healthy pipeline of opportunities and is securing additional wins as large projects come online. Factory reshoring and other large-scale projects are widening the company's addressable staffing opportunities. Closer coordination with franchisees is benefiting the company in capturing business that might have gone unserved.
HQI’s selling franchisees raised their top line nearly 15%, supported by solid manufacturing activity. Management noted that factory reshoring is supporting the restoration of employment opportunities that may have been lost, while demand enhancement is becoming broad-based across markets.
HireQuest currently carries a Zacks Rank of 2. The Zacks Consensus Estimate for 2026 EPS has been unchanged at 80 cents over the past 30 days. The company’s shares have skyrocketed 106.4% over the past six months.
View the Zacks #1 Rank List
Image: Bigstock
Here Are 3 Staffing Stocks to Consider Despite Industry Challenges
The Staffing Firms industry is being restructured by AI-driven hiring, consistent skill shortages and flexible workforce demand, creating opportunities for specialized recruitment despite economic headwinds and technology-backed disintermediation risks.
RCM Technologies (RCMT - Free Report) , TrueBlue (TBI - Free Report) and HireQuest (HQI - Free Report) are positioned to benefit from evolving client needs.
Industry Description
The Zacks Staffing industry is a diverse sector encompassing companies that offer a comprehensive range of human resources and workforce solutions. These services cover various aspects of personnel management, including employment screening, recruitment services for both temporary and long-term job placements, retirement planning, human capital management, payroll administration, performance evaluation, organizational planning, and financial management. Some firms within this industry provide specialized services, such as staffing and risk consulting, professional staffing, and global business solutions tailored to the needs of small to medium-sized enterprises. They also offer organizational consulting services with a worldwide reach, catering to a vast and varied client base, which includes domestic and international businesses across different sectors and industries.
What's Shaping the Future of the Staffing Firms Industry?
AI Adoption & Inclination Toward Skills-Based Hiring: AI is moving the needle between what clients hire for and how staffing firms recruit. Rising demand for AI, data, cybersecurity and other specialized skills is met with recruiters leveraging AI for sourcing, screening and candidate matching. A recent ManpowerGroup report mentioned that 72% of global employers are facing difficulty in filling roles, with AI skills becoming the hardest capabilities to find. A Korn Ferry published last year stated that 84% of talent leaders strategize to leverage AI in 2026, hinting at how rapidly technology is becoming embedded in recruiting workflows. While staffing firms can supply scarce technology talent and enhance recruiter productivity via automation, this raises the risks of disintermediation as clients utilize AI tools directly.
Demand Upsurge in Specialized Staffing Amid Skill Shortages: Companies continued to struggle to find workers with the right skills despite greater candidate availability. Per a Robert Half report, 58% of business leaders remark that finding skilled professionals has become harder than a year ago, while 67% are highly likely to seek staffing firms’ assistance. The same report suggests that among technology employers, 65% report hindrance in finding skilled talent and shortages have resulted in project delays for 71% of respondents. The shortage is experienced in capabilities rather than headcount. A ManpowerGroup reportsuggests that 62% of employers planning to expand staffing cite changing roles and skills as the primary reason, highlighting rising demand for expertise introduced by technology and business-model transformation. Staffing companies will grab this opportunity to identify and validate scarce talent.
Economic State & Dynamic Workforce Demand: Staffing remains sensitive to the economic cycle because employers typically adjust temporary and contract hiring before making commitments to permanent workforce. The Bureau of Labor Statisticsstated that U.S. temporary-help employment reached 2.52 million in August 2026, rising from 2.48 million earlier in the year. Per an American Staffing Association report, staffing employment in September was 3.3% above the year-ago level and moved up marginally from its August reading.
Zacks Industry Rank Indicates Sluggish Near-Term Prospects
The Zacks Staffing Firms industry, which is housed within the broader Zacks Business Services sector, currently carries a Zacks Industry Rank #192. This rank places it in the bottom 22% of the 247 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all member stocks, indicates a continued outperformance in the near term. Our research shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
Before we present a few stocks that you may want to consider for your portfolio, let us look at the industry’s recent stock market performance and current valuation.
Industry Beats Sector & S&P 500
Over the past year, the Zacks Staffing Firms industry has outperformed the broader sector and the S&P 500.
The industry has risen 22.7%, whereas the broader sector fell 20.2% and the S&P 500 composite has returned 18.7% over the same period.
1-Year Price Performance
Industry's Current Valuation
Based on EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation and amortization), which is commonly used to value staffing stocks, given their high debt levels, the industry is currently trading at 8.76X compared with the S&P 500’s 17.94X and the sector’s 10.27X.
Over the past five years, the industry has traded as high as 10.64X and as low as 4.37X, with the median being 7.39X, as the charts below show.
EV-to-EBITDA
3 Staffing Stocks Poised for Growth
We have presented three stocks that are expected to grow in the near term.
RCM Technologies: This business and technology solutions provider delivered solid second-quarter 2026 performance, with the top line rising 20% year over year and gross profit rising 8.1%. The quarter remained profitable as net income advanced 29.5%. Importantly, selling, general and administrative (SG&A) expenses registered a modest uptick despite a sharp top-line upswing, underscoring improving operational prowess and scalability of RCMT’s cost structure.
The Engineering segment remained the primary growth driver, with revenues increasing nearly 49% year over year. This growth is driven by stronger Energy Services activity, mainly Engineering, Procurement and Construction Management projects. These large-scale project activities support RCMT’s Engineering segment’s growth while strengthening customer relationships.
The top-line expansion and operational enhancement translated into robust earnings growth. In the second quarter of 2026, adjusted earnings per share (EPS) gained 18.8% year over year. Adjusted EBITDA registered a 14.8% year-over-year increase during the aforementioned quarter, resulting in 9.9% growth in the first half of the year, implying that earnings momentum persists beyond a single quarter.
RCM Technologies’ cash improved to $6.6 million from $2.9 million at the beginning of the year, amid debt repayments and share repurchases. An improved cash generation enhances RCMT’s flexibility to invest in recruiting, expanding sales capabilities and chasing growth opportunities, while also returning capital to shareholders.
RCMT currently flaunts a Zacks Rank of 1 (Strong Buy). The Zacks Consensus Estimate for 2026 EPS has been flat at $3.07 over the past 30 days. The company’s shares have skyrocketed 109.2% over the past six months.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Price and Consensus: RCMT
TrueBlue: This specialized workforce and recruitment solutions company registered 12% year-over-year growth in its top line in the second quarter of 2026. TrueBlue’s skilled businesses remained the primary growth engine, delivering double-digit revenue growth for the fifth consecutive quarter. PeopleReady revenues gained 23% year over year, fueled by the energy vertical. The commercial driver business also registered its 10th consecutive quarter of growth.
TrueBlue’s partnerships and cross-selling initiatives are broadening its sales reach and introducing additional client channels. Previously announced partnership wins began converting into revenues during the quarter, while the multi-brand pipeline presents additional opportunities for growth. The U.K. Armed Forces engagement is increasing and is anticipated to achieve its full value in 2027, providing additional revenue visibility. TBI secured a new deal with a large battery storage provider, demonstrating sustained momentum in one of its fastest-growing verticals.
TrueBlue’s top-line translated into improved profitability through prudent cost-management and technology-enabled operational efficiency. In the second quarter of 2026, SG&A expenses dipped 7% year over year despite double-digit top-line growth. Adjusted EBITDA registered a lofty increase to $11 million from the year-ago quarter’s $3 million, while adjusted net income recovered to $2 million from the year-ago quarter’s $2-million loss. Margins of PeopleReady, PeopleManagement and PeopleSolutions improved 260, 60 and 510 basis points, respectively, demonstrating scalability of the company’s operating model.
TBI currently carries a Zacks Rank of 2 (Buy). The Zacks Consensus Estimate for 2026 EPS has been unchanged at 6 cents over the past 30 days. The company’s shares have escalated 150.4% over the past six months.
Price and Consensus: TBI
HireQuest: This staffing, recruiting and workforce solutions franchisor’s ongoing operations began the second quarter of 2026 with year-over-year growth of 2-4%, which increased to 12-13% in some weeks toward the end of the quarter. Importantly, improving demand conditions through the first six weeks of the third quarter provide evidence that the company held on to the growth momentum.
HireQuest noted tangible growth opportunities and incremental customer wins from investments in HQI’s national accounts program. It is successful at creating a healthy pipeline of opportunities and is securing additional wins as large projects come online. Factory reshoring and other large-scale projects are widening the company's addressable staffing opportunities. Closer coordination with franchisees is benefiting the company in capturing business that might have gone unserved.
HQI’s selling franchisees raised their top line nearly 15%, supported by solid manufacturing activity. Management noted that factory reshoring is supporting the restoration of employment opportunities that may have been lost, while demand enhancement is becoming broad-based across markets.
HireQuest currently carries a Zacks Rank of 2. The Zacks Consensus Estimate for 2026 EPS has been unchanged at 80 cents over the past 30 days. The company’s shares have skyrocketed 106.4% over the past six months.
Price and Consensus: HQI