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 September 30, 2011									For The Three Months Ended September 30, 2010
	Temporary			Other			Total			Temporary			Other			Total
Revenue		$	182,867		$	62,214		$	245,081		$	147,910		$	52,484		$	200,394
Direct costs (1)			148,513			3,576			152,089			122,161			3,242			125,403
Gross margin		$	34,354		$	58,638		$	92,992		$	25,749		$	49,242		$	74,991

	For The Nine Months Ended September 30, 2011									For The Nine Months Ended September 30, 2010
	Temporary			Other			Total			Temporary			Other			Total
Revenue		$	526,734		$	184,264		$	710,998		$	425,111		$	150,370		$	575,481
Direct costs (1)			430,338			11,003			441,341			349,695			10,138			359,833
Gross margin		$	96,396		$	173,261		$	269,657		$	75,416		$	140,232		$	215,648

(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.