IT jobs growth cools for contractors

Demand from recruiters for temporary IT staff sunk in May for the second month in a row, over four weeks that saw growth in freelance computer jobs decline at its fastest rate so far this year.

In its latest member poll of 400 agencies, The Recruitment and Employment Confederation scored IT contractor demand at 60.5, up from last May (56.8), yet down on the four preceding months of 2011. 

The weakness, appearing more acute due to March being buoyant for temporary IT job-seekers, reflects the wider climate for non-permanent staff as total billings of temps fell to a seven-month low.   

But the slippage in IT contractor placements does not indicate technical staff are off the hiring agenda - on a full-time basis, IT staff were May’s most sought-after, followed by engineers, the REC found.

Freshly issued figures, relating to both types of IT candidate, from online job site Monster also suggest that “technically skilled workers” should have enjoyed a spike in demand in April.

According to the site’s UK index, online demand for professionals in engineering and IT is up by 30 per cent and by 30 per cent respectively, when compared to April 2010.

This growth for technical workers was in spite of the month containing only 18 working days. Or perhaps, argued dePoel, a provider of temporary professionals, it was a result of it. 

Chief executive Matthew Sanders told CUK: “April continued to see a growth in the use of temporary agency labour in the Business Services sector [which includes IT services].

“This may be due to the high number of Bank Holidays and the opportunity for employees to take long breaks from work whilst only using a few days of their holiday allowance.”

The REC’s data actually casts April as the first shower to hit temporary IT workers this year, as growth slowed, yet out of the seven other key sectors surveyed, Computing/IT was still the brightest in terms of billings.

Monster’s sample of computer jobs, meanwhile, may or may not include a recruiter but its analysis chimes with the REC’s, in that both reports show IT job-creation to be at a similar level to February’s.

However back then, the market for temporary IT workers was on the cusp of expanding, whereas now the market is “uncertain” said the confederation, albeit to describe recruitment as a whole.

“Employers across all sectors are becoming more cautious about hiring new staff,” reflected Bernard Brown, head of business services at KPMG.

“With businesses and consumers now being hit by higher taxes and fuel costs, public spending cuts and a continuing squeeze on real incomes – this is perhaps no surprise.”

 A similarly downbeat verdict came from Powerchex, a pre-employment screener of six categories of professional candidate for the financial services industry, the biggest sector-user of IT contractors.

“Financial Services’ hiring is probably going to slow down again” managing director Alexandra Kelly said yesterday, responding to questions.

“Financial hirers went a little bit too fast with their recruitment in the initial months of this year and still the economy is not supporting that added investment.”

Unsettling for all staff, end-users are all too aware they are yet to see any return - so purse strings remain tight: salary inflation eased to a three-month low, and rate inflation is at its lowest for four months.

The REC’s more positive finding for those on flat pay must be that the availability of candidates – the competition, reduced in May, across the breadth of full-time and contract roles.

But seeming to suggest that financial pressures, both micro and macro, will remain for the foreseeable future, Mr Brown spoke only of “hope” that growth will pick up “later this year.”

Cash-conscious employers returning to the fold, at some stage before 2012, is unlikely to represent a shoo-in for Britons looking for technical roles or IT work, however. 

According to the Chartered Institute of Personnel and Development, UK organisations that intend to hire from overseas between now and July 1^st mostly want such migrants to fill  posts in engineering and IT.