Momentum Q3 2025 Report

After two surprisingly strong quarters to start the year, North American staffing M&A deal volume fell sharply in Q3 2025. Only 16 transactions were announced or completed, down significantly from 38 in Q2 and 32 in Q1. This decline represents one of the weakest quarters for staffing M&A since the pandemic era and underscores the broader challenges now facing the sector.

The slowdown was not driven by a lack of buyer interest. Buyer appetite remains robust – especially for high-quality assets. One of our current sell-side mandates generated record-setting buyer interest not seen in Momentum’s history. That level of demand, even in a quieter quarter, highlights that interest remains strong, but the bar to action has moved higher. With fewer actionable deals in the market, buyers are shifting their focus and becoming increasingly selective, engaging only when opportunities meet exact criteria.

Private equity’s role stayed muted. All three PE-involved deals this quarter were add-ons; there were no new platforms launched. Sluggish performance with existing assets and reduced exit options have slowed the traditional invest-cash-reinvest cycle for many buyout firms, constraining new fund formation and limiting broader staffing investment activity.

Strategic buyers remained active, with recognizable names such as Tandym, Accenture and Ascend completing deals—though none of the transactions in Q3 landed in the “transformational” category. The activity of well-known buyers in smaller deals underscores a strategy of selective bolt-ons rather than bold platform shifts.

On the industry front, staffing continues to face headwinds. Labor-market growth remains soft and uneven. Recent jobs data and industry forecasts suggest a more sluggish second half of the year than previously anticipated. For example, Staffing Industry Analysts recently revised its 2025 outlook from what was once 5% projected growth to now a flat or even declining forecast. Given this backdrop, staffing M&A volume in Q4 and beyond will be more strongly driven by differentiated sellers rather than broad market volume.

As we move through Q4, early data indicates a continuation of the slower trend. Only seven acquisitions were recorded through the beginning of November, mirroring the low volume and smaller scale seen in Q3. While the current pace remains subdued, there is still potential for a late-quarter surge. Historically, both buyers and sellers push to finalize deals before the calendar year ends. Whether that materializes in Q4 remains to be seen, but the window for a meaningful uptick is narrowing.