NOTE 6 – REVENUE, DIRECT COSTS AND GROSS MARGIN

The Company’s revenue, direct costs and gross margin were as follows:

	For The Three Months Ended June 30, 2011									For The Three Months Ended June 30, 2010
	Temporary			Other			Total			Temporary			Other			Total
Revenue		$	180,806		$	66,572		$	247,378		$	142,169		$	52,800		$	194,969
Direct costs (1)			147,669			4,242			151,911			116,979			3,753			120,732
Gross margin		$	33,137		$	62,330		$	95,467		$	25,190		$	49,047		$	74,237

	For The Six Months Ended June 30, 2011									For The Six Months Ended June 30, 2010
	Temporary			Other			Total			Temporary			Other			Total
Revenue		$	343,867		$	122,050		$	465,917		$	277,201		$	97,886		$	375,087
Direct costs (1)			281,825			7,427			289,252			227,536			6,894			234,430
Gross margin		$	62,042		$	114,623		$	176,665		$	49,665		$	90,992		$	140,657

(1)

Direct costs include the direct staffing costs of salaries, payroll taxes, employee benefits, travel expenses and insurance costs for the Company’s contractors and reimbursed out-of-pocket expenses and other direct costs. Other than reimbursed out-of-pocket expenses, there are no other direct costs associated with the Other category, which includes the search, permanent recruitment and other human resource solutions’ revenue. Gross margin represents revenue less direct costs. The region where services are provided, the mix of contracting and permanent recruitment, and the functional nature of the staffing services provided can affect gross margin. The salaries, commissions, payroll taxes and employee benefits related to recruitment professionals are included in selling, general and administrative expenses.