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| CURRENT SECTION :: Market Reports | UK's most visited IT Contractor Site - 250k unique visitors March 2008 |
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Officially, 21 March marked the beginning of Spring. The IT contractor market, however, is yet to notice any blooming rates, or new season optimism. Average rates across the ten most commonly requested IT skills have fallen over the last month, from £30.42 per hour to £30.07 per hour. This is a drop of just over 1%. While not catastrophic, it marks three consecutives falls through the first quarter of 2007. The first, in January , was bigger, but this is just as significant. January’s big fall could largely be attributed to the replacement of architects with .NET developers in our top ten. No such switch has occurred here, which suggests a general droop in the market. Part of this can be blamed on the season. Many firms allocate budgets according to the fiscal, rather than calendar, year and the fall for March may just mean that Project Managers and Programme Directors have run out of cash. If we see a lift in April, the dull start to 2007 can be viewed as a blip rather than a worrying trend. Other available figures also seem to suggest that the future is relatively rosy. As reported on this site earlier this month, Atsco figures claim that “rates for IT consultants have soared 17% over the past 12 months on the back of runaway demand in both Public and Finance sectors”. The £2.8 billion spent on external consultants by the public sector last year was 1 billion more than the year before. We must assume that a big chunk of that went on IT folk. The public sector has served IT contractors well over the recent past, but this may be about to end. Mark Verghese is a director of recruitment firm Greythorn. He says that, “the bad publicity about overspends has meant that there is now increasing pressure from the government to keep project costs down. That’s likely to mean less interesting work and reduced rates of pay." His concerns are reflected in our market figures. Contract IT job advertisements quoting “government” currently have a maximum average day rate of £404. This is up from £395 a year ago. But, the more recent figures are less encouraging. In November, the figure was £411, and it has been falling ever since. Around 10% of jobs advertised today use the word “government”. This clearly indicates the importance of the public sector as an employer, but the figure was 14.5% just over a year ago. If we look specifically at the NHS, we can see that rate tumbles have been happening for some time. Average day rates have gone from £335 to £310 in the last 12 months. It is possible then, that the stubbornly downward trend of 2007 is a result of a bigger shutdown of public sector IT spending. IT contractors must hope that the private sector begins to take up the slack. Figures from recruitment firm Praxis executive appear to suggest that they already are, certainly at the top end. A recent survey by the firm suggests that employers are increasingly looking for interims to fill top IT roles, where permies would traditionally hold sway. Jeremy Finch, the company’s MD, notes that, "increasingly, when firms look at IT projects, they realise they don’t really need a permanent position. IT managers are used to project work and used to focusing on deliverables so they can be very effective. ”This has seen rates for IT interims reach as much as £1,000 per day. But, the danger is that interims will also take work away from traditional IT contractors. "A lot of firms have also had their hand bitten by consultants,” Finch reckons, “and they find a good interim manager can do a lot of the same work as a consultant for less." Matt Farquharson Data source: www.itjobswatch.co.uk Apr 4, 2007 Email this article Printer friendly page Previous Page
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