Staffing agencies in Philadelphia: a four-state market, its search firms and the rules on each side

This report is for employers in the Philadelphia region choosing an agency or search firm, job seekers deciding where to register, and B2B sellers whose customers are staffing firms. It covers the metro across southeastern Pennsylvania, South Jersey, northern Delaware and Cecil County, Maryland.

The numbers

US Census Bureau, County Business Patterns 2023, for the Philadelphia-Camden-Wilmington, PA-NJ-DE-MD Metro Area (CBSA 37980), NAICS 56131 (Employment Placement Agencies and Executive Search Services) and 56132 (Temporary Help Services):

Two things stand out. Temp branches hold 86% of the jobs because a temp agency is the employer of the people it places, so its workers at client sites are counted at the branch. And executive search, with only 1,555 employees, has a bigger payroll than placement agencies with more than twice the staff: about $245,700 a head, the pay of small firms that bill on senior hires.

Where they are and how big

These eight counties hold 1,012 of the 1,047 locations. Burlington's agencies are the largest, about 44 employees each; Bucks County's average about 18.

In broader bands, 719 establishments have 1 to 19 employees, 224 have 20 to 99 and 104 have 100 or more; the 104 is the total less the smaller bands, because the Census Bureau doesn't publish the top classes for the combined codes. The industry rows fill them in: 23 temp branches have 250 to 499 employees and 4 have 500 to 999; no placement or search office has 250, and no location has 1,000.

These are establishments with paid employees, not companies, so a national firm with offices in Center City, King of Prussia and Cherry Hill counts three times, and self-employed recruiters are left out. Professional employer organizations are counted separately: 109 locations in the metro.

The public staffing company headquartered here

RCM's 10-K says about 9.1% of revenue came from outside the United States, and that it employed about 385 nonbillable staff, its recruiters, managers and administrators, at the year end.

Which kind of firm you need

• Temp and temp-to-hire: warehouse, production, office and call center work, billed hourly.
• Healthcare staffing: nurses, therapists and school health staff, often by contract.
• IT, engineering and life sciences contract: project specialists billed by the hour.
• Direct hire placement: a fee for a permanent hire.
• Executive search: retained or contingency firms for senior roles.
• PEO: payroll and HR for staff you already employ.

The rules on each side of the river

In Philadelphia itself, the city's paid sick leave law gives employees one hour of sick time for every 40 hours worked, up to 40 hours a year, paid at employers with 10 or more employees. Its exemptions include "seasonal workers and employees hired for less than six months," which matters for short temp assignments. For the New Jersey rules in detail, see the report on staffing agencies in Jersey City.

Worked example: one client, two sites, two states

Illustrative example. The company, pay rates, benefits cost and markup are invented; the equal pay rule is New Jersey's.

Delaware Valley Fulfillment (dvfulfill.example) runs warehouses in Northeast Philadelphia and in Pennsauken, New Jersey, and orders 10 temp pickers for each site for 12 weeks at 40 hours a week: 480 hours per temp. Its agency marks up pay by 35%.

In Philadelphia the agency's market pay rate for pickers is $17.50. In Pennsauken, picking is a designated classification under New Jersey's Temporary Workers' Bill of Rights, so the temps must get at least the average pay and average cost of benefits of the client's own pickers there. Those employees average $19.00 an hour plus $3.50 an hour of benefits, so the temps get $22.50 as pay or pay plus benefits.

New Jersey's $15.92 minimum wage isn't what sets the price here; the client's own pay and benefits are. Budget the New Jersey site from your payroll data, and expect the agency to ask for it.

How to vet an agency or search firm

1. Check the entity in the state where it's registered: Pennsylvania's Department of State, Delaware's Division of Corporations or New Jersey's business records service.
2. For New Jersey placements in covered jobs, ask for the firm's Division of Consumer Affairs certification.
3. Get certificates for workers' compensation and general liability naming your company.
4. Price by work site, because the minimum wage, sick leave and temp rules differ by state and city.
5. For search, ask whether the fee is retained (paid in stages whether or not you hire) or contingency (paid only on a hire), and get completion rates, off-limits terms and the guarantee in writing.
6. Read ratings on ClearlyRated and call two references.

If you're looking for work

Agencies are paid by employers, so you shouldn't pay to register. If you live in Philadelphia but take an assignment in Camden or Burlington County, New Jersey's minimum wage and temp worker protections apply to that work. In Philadelphia, ask how the agency handles sick time if your assignment will run longer than six months.

Selling to Philadelphia staffing and search firms

The metro has two very different buyers. The 731 temp branches buy timekeeping, screening, safety training and job advertising, and the South Jersey branches carry extra paperwork under New Jersey's temp law. The 148 search offices buy candidate research, compensation data, assessment and video interviewing, with partners who sign quickly when a tool saves search hours.

Map firms by county, then by type from their postings and websites. At volume, Bebop finds firms matching a description and drafts the opener. For reaching partners at search firms, see how to find decision makers.

Subject: Pay data for your [function] searches

Hi [first name],

I saw [firm] is running searches for [role] in the life sciences corridor.

Clients ask for pay ranges in the first meeting, and a stale survey costs credibility. Our [product] gives current base and bonus ranges by title and region, refreshed [frequency].

Worth seeing the numbers for your current searches?

[Your name]

Local sources

Next step: see the New Jersey temp rules applied in the report on staffing agencies in Jersey City.