If staffing companies are investing in IT improvements, could an economic turnaround be on the horizon? History shows that demand for contract workers often picks up just before an economic turnaround, because companies start to ramp up but are wary of adding full-timers. Some temporary staffing companies are seeing more demand in recent weeks and are making IT investments to better manage their workers.

At Remy Corp., which places IT temps, demand has increased about 11% the past two months. Remy is buying PeopleSoft Staffing FrontOffice 8.4, part of PeopleSoft Inc.'s upgraded staffing suite, released last week. In addition to providing functionality, the software will help the $40 million-a-year staffing firm integrate two companies it plans to complete acquisition of in December, says Remy principal Andrew Albarelle. Some of his competitors also are upgrading their technology, he says, and PeopleSoft has inked at least one other deal for its staffing release. "We're going to be more positioned to grow and be successful in this upturned market than those who couldn't make those investments."