A staffing agency pays its workers every week and bills clients on net terms. The faster the agency grows, the wider that gap becomes, and working capital is how owners cover it.
Apply Now →Placing temporary or contract workers means the agency takes on the employer's side of payroll. Wages go out weekly or biweekly, together with payroll taxes, workers' compensation and insurance. The client is invoiced for the hours worked and pays 30, 45 or sometimes 60 days later.
In effect, the agency extends credit to every client. When the client base is small, that is manageable. When the agency wins a large account or three mid-sized ones at once, the cash needed to carry payroll balloons before the first invoice is paid.
Between steps one and four, the agency has funded between three and eight payrolls on that account, depending on the terms. Multiply by the number of workers and by the number of new accounts, and the gap can quickly exceed what a growing agency holds in reserve.
The state's 2026 minimum wage is $17 an hour in New York City, Long Island and Westchester and $16 in the rest of the state, with indexing beginning in 2027. For light industrial, hospitality, clerical and event staffing, which often pay at or near these levels, each increase raises the weekly cost of every placed worker. If bill rates adjust only at renewal, the agency absorbs the difference in between.
For illustration only: an agency lands a client needing 25 workers for a warehouse peak. Weekly payroll with taxes and insurance might reach the tens of thousands of dollars. If the client pays after six weeks, the agency has funded most of that money before it sees any of it. A $50,000 cushion is the difference between saying yes and sending the lead to a competitor. The test before you borrow is whether the margin on the account, over its length, clearly covers what you would owe back.
The application takes about five minutes with a soft credit pull. We review about three months of business bank statements and no tax returns are required. FICO 500 and above is considered. Funding runs from $25,000 to $5,000,000 and can arrive in as little as 24 hours after approval. Sole proprietors and independent recruiters operating as one-person agencies can apply.
Agencies also spend on job-board and advertising costs, applicant-tracking software, background-check fees, office space and recruiters' salaries. Those costs are front-loaded as well. Many owners treat working capital as a growth tool for hiring the recruiter who will land the next account, and a recruiter takes months to pay back.
Payroll and employer taxes go out weekly while clients pay 30 to 60 days later. Each new account increases the amount the agency must carry.
Yes. Sole proprietors can apply. We review about three months of business bank statements and do not require tax returns.
Payroll during the payment gap, recruiting and onboarding costs, software, insurance and office expansion. Funding runs from $25,000 to $5,000,000.
Yes. The 2026 minimums are $17 in New York City, Long Island and Westchester and $16 elsewhere, which raises the cost of each placed worker.
No. The application uses a soft credit pull, and FICO 500 and above is considered.
Three months of business bank statements and a 5-minute application. FICO 500+ considered. $25,000 to $5,000,000, funded in as little as 24 hours.
Apply Now →It takes about two minutes and it will not affect your credit score.
No obligation • No impact to your credit score
