So many companies are getting into the temp hiring only mode because of many reasons, one of which is that they are able to try and find out about the employee before they make the full commitment that is going to result (if they made it and it turned out to be not good) in costly errors, bad feelings, the necessity of terminating someone, and the possibility that they will be able to draw unemployment benefits, costing the company money.
It's much harder to draw unemployment benefits from a temp service by the nature of the way they operate. And even if the people are working or are discharged at the behest of the employer on the worksite, there's so much less exposure for the company to any sort of those reindeer games like "wrongful termination" and EEOC violations, as well as the workers qualifying for unemployment. It's not so good for the employee, perhaps, but I believe there will come a time when it's just about the only choice job seekers will have. That's an upcoming reality of the workplace of the future, when most of our past experiences with the system will be changing and it won't be like it used to anymore in MANY ways.
In the early 1980's a good person could look for six months diligently for ANY job, and they just weren't there. Eventually there were extensions to Unemployment, but that was only kicked in by the unemployment rate being extremely high. (And my place of work figured that rate, and I will give you a clue here before the unemployment rate goes to a high level, things are incredibly bad on the ground.) There are simply no jobs, good, bad or temporary to be had. This most recent recession cut at and seemed to most affect the older workers in our workforce. And one thing I have seen happen is that employers used the rareness of their jobs to gut the hiring market, pick only younger workers, and go to temps and contractors and to offer much lower starting pays, and make it much harder for a good person to find that good job than it had been in the work world before.