Top 6 Staffing Stocks Amid Steady Decline In Jobless Claims

On May 11, the Labor Department's monthly Job Openings and Labor Turnover Survey (JOLTS) report revealed that job openings jumped 597,000 to 8.1 million at Mar 31, the highest in the history of this data series that commenced in December 2000.

However, the economy added just 266,000 jobs in April significantly below the consensus estimate of 1.035 million. The shortage of skilled laborers is the primary reason for this huge disappointment.

Irrespective of their size — large, mid, or small — U.S. businesses are unable to fill open jobs and are raising both wage rate and other benefits to attract skilled laborers. The average hourly wage rate increased 0.7% in April compared with a 0.1% drop in March.

Some financial experts blamed the $1,400 direct check payment to Americans and a $300 weekly supplement extended up to early September as part of Biden's $1.9 fiscal stimulus as reasons for skilled laborers to avoid the job market.

Several news agencies have reported that 22 states are mulling to stop offering a $300 weekly federal benefit in June in order to force around 3.6 million Americans to join the labor force. All these benefits will likely benefit staffing firms immensely as higher recruitment will increase their scope of business resulting in higher profits.

Our Top Picks

We have narrowed down our search to six staffing stocks that have provided double-digit return year to date. These stocks have strong growth potential for 2021 and have seen positive earnings estimate revisions in the last 30 to 60 days.

Moreover,  most of these companies are regular dividend payers providing an important income stream during the market's downturn. Finally, each of our picks carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). 

The chart below shows the price performance of our six picks year to date.

Heidrick & Struggles International Inc. (HSII Quick Quote HSII - Free Report) provides executive search and consulting services to businesses and business leaders worldwide. It enables clients to build leadership teams by facilitating the recruitment, management, and development of senior executives.

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