During a recession is the worst time to be a temp — whatever work companies have will go to employees, as a way to avoid having to lay them off. Another bad time is the middle of a recovery — things are going so well that managers figure it's safe to hire new permanent employees. Still, there are two good times to look for temp work, and we're coming up on one of them.

One good time to look for temp work is the second half of a period of growth. By that point unemployment is usually low enough that companies are having trouble recruiting new full-time employees, so they turn to temps.

The other good time, though — and this is the one we're approaching — is early in a recovery. When no one is sure that growth will last, companies will resist hiring new permanent employees. But if business is expanding, there's work that needs to get done.

At the very beginning of a recovery, companies will try to squeeze some extra work out of the employees they've got — but that only goes so far. Pretty soon they find that they're losing business because their employees can't get everything done. They need more hands, but are afraid to hire, and that's the point they turn to temps.

The Bureau of Labor Statistics data on "Temporary help services" shows a small uptick started in August (see graph above). It doesn't amount to much yet, but if the economy continues to grow, we may see considerable growth in temp work — growth that will beat the growth in overall employment until employer confidence returns strongly enough that they're ready to start hiring new permanent workers.

Much the same applies to freelance work as well. Employers who need to get work done — but don't want to hire new employees — will turn to freelancers much like they turn to temps.

Let me add one caveat here: I'm not predicting continued growth. It's hard enough to predict the present, let alone the future. The recent past, though, we can be pretty confident of — and the latest statistics show economic growth. The economy could turn back down — in fact it surely will, sooner or later. But, in the meantime, we're coming up on the best environment temps and freelancers have seen in years.

Updated 21 December 2009: The latest BLS numbers are just out and show the surge in temp worker employment is continuing.  Here's a graph with the latest data:

Updated temp worker graph