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Contractors paid 'twice as much' as IT employees


Freelance ICT professionals are earning more than twice as much as their permanently employed counterparts every hour in the UK public sector, Contractor UK has learnt.

Research by E-skills shows a total of 140,000 ICT staff each earns an average of £570 a week – about £15 an hour - working full-time on local and central government projects.

Yet just last month freelance contractors hired for niche ICT skills were paid an average rate of £35 an hour – about £1300 a week, according to the latest survey from ATSCo/iProfileStats.

Both market readings say the prospect of high pay on government projects is vital in securing the sector’s now-growing cadre of IT professionals, despite signs of a slowdown in state spending.

The sector’s ICT workforce has ballooned by 28 per cent, from 109,000 at the end of 2001- to 140,000 by the end of 2005, says the ICT bulletin from the sector skills council.

Ann Swain, chief executive of ATSCo, says some of the influx is thanks to freelance contractors migrating where hourly rates in the public sector have overtaken private sector premiums.

“The current [contractors’] rate of £35 per hour is exactly equivalent to the median in the private sector,” the Association of Technology Staffing Companies (ATSCo) said in a statement.

“But many private sector industries actually pay less - IT service providers and Health & Pharmaceuticals both pay around £30 per hour, for example.”

E-Skills reports that hourly rates for contractors appear to have taken a tumble, albeit marginally, at the end of 2005 across both private and public sectors.

Though the sector skills council conceded its data stems from the market’s advertised rates, whereas the actual paid rates are measured by the ATSCo/iProfileStats survey.

The government-backed agency, set up to ease the IT skills shortage, hinted that with public sector pay being on average 14 per cent lower than in the private sector, job perks had played a part.

Factors like shorter working hours and longer holiday pay had attracted IT professionals to the public sector, suggesting one perceived perk of working for the state is a better work-life balance.

“This growth in public sector ICT employment has come about through increases in the number of ICT Managers and Operations/User Support Technicians,” the skills watchdog said.

“Together, these groups of ICT staff accounted for some 75 per cent of the 140,000 ICT staff working in the public sector during the final quarter of 2005.”

In line with predictions published on Contractor UK, demand for IT professionals skilled in project management soared at the end of 2005, as the market inched closer to a cluster of new projects.

At the time, PMs emerged as the most in-demand IT professional in the public sector, and the second most in-demand in the private sector, according to E-skills data.

In 2006, too many project managers are technically sound but untrained in business methods, systems analysis, organisational behaviour and change management, IMIS said yesterday.

The Institute’s strategic advisor Philip Virgo warned client companies in both the public and private sectors that such ‘IT specialists’ are likely to be “commercially lethal.”





Jul 27, 2006

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