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Contractors are not well-placed to grab inflation-busting pay premiums that their clients are handing out to retain or recruit mid-tier IT skills on a permanent basis. Demand for most IT skills, not just for mid-level work, on a contract basis has held steady or stagnated since last year, making rate rises unlikely in the short-term. Not one area of contract IT skills is noticeably more in demand than it was last year, and the premise that shortages will spike contract demand, and pay, is currently "over-hyped." Phil Soffe, managing consultant of IT recruitment at Hudson, also told CUK that the current economic conditions had injected a “huge element of caution” into the market. He was responding to a report which claims salaries for some mid-level and technical staff were up by 13% this year, representing ‘the IT sector’s biggest pay rise.’ The loss of entry level IT jobs via offshoring and the sharp decline in IT graduates has created a skills gap which is fuelling wage inflation in the mid-tier, the report says. Based on 80 employer responses, the report shows salaries for support technicians jumped 13% to £24,177, and network/systems engineers saw a 9.5% hike to £31,120. Ken Mulkearn of Income Data Services, which commissioned the report, said the significant pay growth, driven by acute shortages, compared with the average salary climb of 3.5%. He explained: “As the UK IT sector continues to specialise increasingly in more high-end technical work, and more entry-level jobs are outsourced overseas, there are fewer opportunities for graduates and others with less experience to get a foot on the first rung of the career ladder. “The knock-on effect is that higher up that ladder, where there is demand for skilled and experienced workers, there is not enough supply coming through the ranks, making recruitment and retention more difficult, and driving up salaries as a result.” Yet so far this year, Hudson, which places IT staff across the UK and overseas, does not believe any shortage of IT skills has dramatically pushed up rates for relevantly skilled contractors. “What we have actually seen is a number of clients have done the reverse and have instigated rate cuts, and not just within the financial sector, although this is the most obvious area,” Mr Soffe said. “There is always demand for standard development tools based around .Net technologies, C#, Java, J2EE, but there is nothing out there that has demanded a premium on the market at this stage.” For each of the listed IT skills, the agency warned there was “an ample supply of contractors,” including some very talented ones, who are now on the market and competing for work. Figures provided to CUK by Monster, the world’s largest recruitment website, confirm that IT candidates, including contractors, are now fighting over far fewer opportunities. According to the site’s analysis of million of online jobs, recruitment activity in the UK IT sector fell in July for the fifth month in a row, representing an annual decline in activity of 12 per cent. Aug 27, 2008 Email this article Printer friendly page Previous Page
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