In December, the unemployment rate fell to its lowest level in nearly three years. Granted, there are still millions of Americans out of work, but the good news is that we are seeing a modest upward trend in job creation. (For related reading, see What You Need To Know About The Employment Report.)
Investopedia Markets: Explore the best one-stop source for financial news, quotes and insights.

The biggest winner of this economic climb could be the staffing and outsourcing sector. As more firms are hiring, they will likely turn to staffing companies rather than bring on full-time employees with a plethora of unknown variables hanging over the global economy. The staffing firms will also have a bevy of viable candidates ready at their fingertips to place into open jobs.

Robert Half International (NYSE:RHI) operates around the globe and may be best known for its Accountemps division that offers temporary staffing for the accounting and finance sectors. The company staffs a variety of sectors for both full-time and part-time positions. From a fundamental viewpoint, the stock has a PEG ratio around 0.95 and a forward P/E ratio of approximately 20.16, with an annual dividend of 2%. The stock currently sits in the high-$20s and a breakout above its July 2011 high would be a new buy signal.

Korn/Ferry International (NYSE:KFY) is not as big as RHI and it has a more narrow approach to its business model. The company concentrates on executive recruitment as well as talent consulting and acquisition solutions. KFY also has strong fundamentals with a forward P/E ratio near 13.2 and a PEG ratio of roughly 0.97. The stock does not pay a dividend. Technically, the stock is trading above all relevant moving averages. The key is to hold support around the $17.50 area.

TrueBlue (NYSE:TBI) provides blue-collar staffing services in the U.S. under the brands Labor Ready and Spartan Staffing. Trading with similar fundamentals, TBI has a strong chart in 2012. The forward P/E ratio for the stock is just under 17.0 and the PEG ratio is about 1.09. On the chart, TBI closed at its best level since last April and is up more than 14% so far this year. The stock should not be bought at current levels, but a pullback to the $15 range could be a better opportunity. (To learn more, read Fundamentals And Technicals: Together At Last.)

Manpower Group (NYSE:MAN) provides employment services around the globe, including permanent and temporary staffing and consulting services for its customers. The stock pays approximately a 2.1% dividend and trades with a forward P/E ratio of nearly 11.1 and a PEG ratio of about 0.69. From a fundamental view, the stock is the most attractive of the group. The stock did rally from a bottom in the last month and is now near its best level in five weeks. However, the chart shows that investors are still concerned about the economy and this company in particular. Until the technicals improve, it will be tough to recommend the stock.

The Bottom Line
As an investor already knows, if the jobs situation does not continue to improve, the entire concept mentioned above is out the window. The employment rate does not have to improve dramatically, but it does need to keep moving in the right direction. (For additional reading, see The Unemployment Rate: Get Real.)

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

At the time of writing, Matthew McCall did not own shares in any of the companies mentioned in this article.

Related Articles
  1. Personal Finance

    A Day in the Life of an Equity Research Analyst

    What does an equity research analyst do on an everyday basis?
  2. Mutual Funds & ETFs

    ETF Analysis: PowerShares S&P 500 Downside Hedged

    Find out about the PowerShares S&P 500 Downside Hedged ETF, and learn detailed information about characteristics, suitability and recommendations of it.
  3. Mutual Funds & ETFs

    ETF Analysis: ProShares Large Cap Core Plus

    Learn information about the ProShares Large Cap Core Plus ETF, and explore detailed analysis of its characteristics, suitability and recommendations.
  4. Mutual Funds & ETFs

    ETF Analysis: iShares Core Growth Allocation

    Find out about the iShares Core Growth Allocation Fund, and learn detailed information about its characteristics, suitability and recommendations.
  5. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI USA Minimum Volatility

    Learn about the iShares MSCI USA Minimum Volatility exchange-traded fund, which invests in low-volatility equities traded on the U.S. stock market.
  6. Stock Analysis

    Should You Follow Millionaires into This Sector?

    Millionaire investors—and those who follow them—should take another look at the current economic situation before making any more investment decisions.
  7. Professionals

    What to do During a Market Correction

    The market has what? Here's what you should consider rather than panicking.
  8. Mutual Funds & ETFs

    ETF Analysis: Vanguard Mid-Cap Value

    Take an in-depth look at the Vanguard Mid-Cap Value ETF, one of the largest and most popular mid-cap funds in the U.S. equity space.
  9. Mutual Funds & ETFs

    ETF Analysis: Schwab US Broad Market

    Take an in-depth look at the Schwab U.S. Broad Market ETF, an incredibly low-cost fund based on a wide selection of the U.S. equity market.
  10. Professionals

    Tips for Helping Clients Though Market Corrections

    When the stock market sees a steep drop, clients are bound to get anxious. Here are some tips for talking them off the ledge.
  1. Equity

    The value of an asset less the value of all liabilities on that ...
  2. Hard-To-Sell Asset

    An asset that is extremely difficult to dispose of either due ...
  3. Sucker Yield

    When an investor has essentially risked all of his capital for ...
  4. PT (Perseroan Terbatas)

    An acronym for Perseroan Terbatas, which is Limited Liability ...
  5. Ltd. (Limited)

    An abbreviation of "limited," Ltd. is a suffix that ...
  6. BHD (Berhad)

    The suffix Bhd. is an abbreviation of a Malay word "berhad," ...
  1. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  2. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  3. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  4. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  5. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>
  6. What happens to the shares of stock purchased in a tender offer?

    The shares of stock purchased in a tender offer become the property of the purchaser. From that point forward, the purchaser, ... Read Full Answer >>

You May Also Like

Trading Center

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!