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DOWNSIZING

s agencies continue to cut jobs under pressure from Congress and the White House, they're relying more on private sector contractors to perform needed work. It's a trend significant enough to have made the front page of The New York Times in mid-March. The Times reported that the federal government's $103 billion in payroll costs last year had declined by about $1 billion from the 1993-94 level, while service contracts with private companies had risen 3.5 percent since 1993, to $114 billion in 1995.

In one sign of the times, a major temporary help agency announced in March that it is setting up a new federal division to focus and expand already-growing business from government agencies. Office Specialists Inc., a $150 million-a-year firm based in Massachusetts, provides clerical and blue-collar help and, increasingly, temporary professional services to such agencies as the Pension Benefit Guaranty Corp. "As government agencies continue to look at outsourcing as a vehicle to improve their services, we continue to experience strong growth" in federal business, says company president Robert Whalen.

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