Staffing Firms Gear Up for Finance Mop-up

CHICAGO (Reuters) - The expected clean-up of the U.S. financial sector and an anticipated economic stimulus package has staffing firms preparing to find jobs for everyone from blue-collar workers to highly trained compliance officers.While most headlines in the past few months have been about companies and industries eliminating jobs and closing factories, once these federal government programs get rolling, demand within some sectors is expected to spike."Cleaning up the bad loans and reregulating the financial sector is going to be huge," said Brendan Courtney, vice president of Mergis Group, a unit of staffing company Spherion Corp (NYSE:SFN - News), which has set up a special group to handle hiring related to the U.S. financial sector bailout. "None of this is going to get done without armies of people."The U.S. Congress is debating a nearly $900 billion economic stimulus package, including tens of billions of dollars for infrastructure projects to create jobs.U.S. President Barack Obama has also vowed to overhaul the nation's financial regulatory system, which may include stricter rules for hedge funds, credit rating agencies and mortgage brokers, to prevent a repeat of the credit crisis that has plunged the world's largest economy into deep recession.And U.S. policymakers are considering whether to place toxic or virtually worthless assets left in the wake of the financial crisis into a bank cleanup program that some analysts estimate could cost as much as $4 trillion.Although the exact form of these programs has yet to be decided, staffing companies say they are preparing to fill a raft of different jobs with accountants, engineers, lawyers, bankers, mortgage specialists and compliance officers."At the moment, we're looking at somewhat of a moving target with many moving parts," said Ed Haidenthaller, a finance operations director at Jefferson Wells, a unit of staffing firm Manpower Inc (NYSE:MAN - News). "Whatever the final shape of these programs, we need to hit the ground running.""We have to be ready now because it will be too late once everything is approved to start thinking ahead," he added.Some analysts say a financial sector cleanup will benefit staffing firms like Robert Half International (NYSE:RHI - News) and Resources Connection Inc (NasdaqGS:RECN - News) unit Resources Global Professionals. Others, including TrueBlue Inc (NYSE:TBI - News), a provider of temporary blue-collar workers, could do well from infrastructure projects as part of the stimulus package.But not enough to offset the impact of the recession."The main bread-and-butter business of the staffing companies has been hit really hard," said Vishnu Lekraj, a stock analyst at Morningstar. "This will not be a game changer, but it will slow their loss of revenue."'BAD BANK' GOOD FOR BUSINESSDemand for temporary workers has fallen in 23 of the past 24 months, according to U.S. government data.But Paul McDonald, an executive director at Robert Half, said the firm had seen an "uptick across the board over the past 60 days" from financial sector customers -- for example, for risk assessment and management posts -- due to bailout money the U.S. government has already pumped into the system.As to what the future holds, staffing company executives are relying on past examples of government cleanups.Staffing executives cite the experience of the Resolution Trust Corporation (RTC) -- created in 1989 to liquidate bad assets from the collapse of savings-and-loan associations."We anticipate the same scenario this time around," Mergis' Courtney said. "We don't know what shoes are left to drop at the banks, but many people -- accountants, lawyers and bankers -- will be needed to work through those problem loans."When discussing Obama's promise to reform financial regulations and tighten oversight of the banking sector, staffing company officials cite the Sarbanes-Oxley Act. Passed in 2002 following financial scandals including Enron, this tightened accounting controls for publicly traded companies.It also meant hiring accountants and compliance officers."We aim to draw on that (Sarbanes-Oxley) experience," said Bob Kovalsky, a senior vice president covering the U.S. northeast at Adecco SA (VTX:ADEN.VX - News).Jefferson Wells' Haidenthaller said since the major banks have cut thousands of jobs there was a decent talent pool to draw from, but a shortage of regulatory compliance managers."If you have 1,000 people laid off from a bank, maybe 5 percent of them will be compliance-oriented," he said. "Individuals with that expertise will be in high demand.""I will give (staffing firms) credit for advance planning," said Jeff Silber, an analyst BMO Capital Markets. "They would be a lot worse off without it, but revenue is still going to decline for everybody."Tobey Sommer, an analyst at SunTrust Robinson Humphrey said he doubted the financial sector cleanup would provide staffing companies with many opportunities."I don't see (a cleanup) being a big boon for staffing companies," he said. "Instead, I think it will be good business for financial consulting firms or big accounting firms."