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‘Summer of cheer’ ahead for contractors

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According to the Contractor UK Market Report the signs are that the next few months will bring good news for IT contractors. For the moment, average rates across the ten most commonly requested IT contract roles are almost exactly as they were at the end of Q1. The rate currently sits at £28.23 per hour, a barely perceptible change from the £28.28 noted at the end of March. These figures come from itjobswatch.co.uk, and are based on more than 100,000 advertised IT roles.

This shows solidity after two years of giddy fluctuations. There was zig-zagging through 2008; a slow decline then a harsh drop in early 2009, and an edgy recovery at the end of that year that eventually petered out. But the first two quarters of 2010 have seen hardly any movement, and those in the industry see improvements ahead. Matthew Smith is MD and CIO Consultant for UK regions with Harvey Nash. He says that, “demand for contract resource remains robust, as do the rates, and roles with a business-facing dynamic are going up.”

This is particularly good news for Business Analysts, who the Jobswatch figures show have seen by far the biggest leap over Q2, from £22.75 per hour to £32.25. Smith sees this as an increasingly common trend. “IT departments are increasingly focusing on bridging the gap with the business,” he says. “This puts a premium on BAs. In Harvey Nash’s recent Global CIO survey, 44% of the respondent said that BA skills are the highest priority. A key piece at our recent CIO events has been around IT alignment and business engagement. How can the technology function understand the business processes, and in turn look at ways to increase efficiency through – at times – the use of technology? Business analysts or business relationship managers are a key enabler to this.”

But BAs may also be benefitting from broader positive trends. According to figures from the umbrella company giant group, there are far fewer IT contractors suffering from long-term unemployment than six months ago. Then, they say, 10.1 % of IT contractors had been out of work for three months or more, compared to just over 6.8% now. Numbers for recruitment body the REC provide further good news. Recent figures claim that demand for ICT labour has increased by 4% over the last few months. According to Jeff Brooks, the chair of the technology chapter of the REC, “At ground level, members say that things have improved markedly from the low points of late 2008 and early 2009.” Specifically, the REC highlights roles for Systems Developers, Architects, .NET and SQL SVR as being on the up.

So where are all the new jobs coming from? Matthew Smith agrees that finance could lead the way. “Many businesses in the finance sector are recruiting. Some due to growth and some as a result of mergers, acquisitions and collaboration. We’ve noticed an increase in rates, which is simply down to good old demand exceeding supply.”

Every credit crunch cloud, it seems, has a silver lining for contractors.

If you enjoyed this story then visit our Contractor News page for all other news. To discuss this story further visit our SJD Accountancy Blog.

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