The authors analyze the nexus between temporary agency work (TAW) and firm performance. Compared to Hirsch and Mueller (2012, The Productivity Effect of Temporary Agency Work: Evidence from German Panel Data. Economic Journal 122 (562): F216-F235) and Nielen and Schiersch (2014, Temporary Agency Work and Firm Competitiveness: Evidence from German Manufacturing Firms. Industrial Relations 53: 365-393), the authors support a concave relationship between the TAW share and productivity, but find a convex relationship between the TAW share and unit labor costs, instead of a u-shape. Moreover, a new finding is that the correlation between the TAW share and profitability is only moderate.