Public sector regains IT contractor hiring confidence

The public sector sharply increased demand for IT contractors in September, in the first sign that non-commercial confidence to take on IT workers, temporarily at least, is returning.

Releasing its latest data, Computer People said the four weeks to October saw the public sector's pool of IT contracts avoid the narrowing seen every month since at least April.

In fact, public IT contract roles notched up by 4.3% in September, reflecting the fact that "business critical projects," at local and central government bodies, "are still going ahead".

"Whilst times may be tough in the public sector", the agency added, "[it] is more inclined to staff up with contract candidates, as hiring managers will have more flexibility and can attribute the cost to direct project line budgets, rather than incurring a fixed cost."

Indeed, the public sector's intake of IT workers on a permanent basis continued to fall in September, the dataset show, although the rate of decline appears to have eased.

Still, the growth for IT contractors was, even by itself, sharp enough for the agency to jot, "public sector regains confidence."

"Over the past six months the contract market has fared better than permanent", Sid Barnes, a director at Computer People said. "[This] could mean that the contract recruitment market is picking up the work that would have been undertaken by permanent staff.

"There was also a large increase in the number of projects that were taken off the shelf and new projects approved. Hiring managers also had new approved budgets and wanted to staff up early whilst quality contract staff were available."

Such a financial impetus must explain why the average rate on public and private IT contracts is 'increasing steadily month-on-month,' most notably for Oracle, C# and .Net contractors.

And although rates for SQL Server and database development were down (compared to August), more was said to be left in the pot.

The agency believes end-users spending "excess budget before year-end", should elevate IT contractor demand in the first three months of 2012.

The "million pound question", then, is what next year's second quarter will bring. "Spending in Q2 will show hiring managers budget levels and confidence levels in the wider IT community," Barnes explained.

"[Almost regardless] 2012, like 2011, will be a year defined by uncertainty.

"There will be two camps; the cautious who wait and see; and those that accept market conditions as the new norm and proceed with 'business as usual' in the execution of their longer term IT strategy".