Market Predictions for the Next Year?

**bobspud** · 5 March 2020, 13:53

Judging by the chaos that has befallen the industry I think that come November there is going to be far fewer contractors.

Having been in a central government department when it originally hit, I was relaxed about it coming to the wider market because I thought (wrongly) that businesses would never do what it turns out they have. I had moved roles from my first outside IR35 contract to yet another Outside IR35 role in government and things were working as intended.

Having had a year(ish) out of government I would say it's gone completely tits up in the private sector. For some reason the pimps have not seen the writing on the wall and seem to be sat smugly thinking we had this coming but they will be fine...

For years if not decades there have been agencies making good money luring the unaware out of permanent jobs to take sub 500 even 400 a day contacts coz it was so tax effective...

Well that's certainly no longer the case.

Even if anyone manages to land an outside IR35 contract they are going to need to be saving double the amount of way chest to carry them through the harsh times and thats really hard when you take expenses into account and see the rates offered on Jobserv etc. So rate are going to need to rise to take that into account. The problem is that won't happen until the bottom feeders have been choked out the market because the low end of the contract market have returned to perm work.

I think this year is pretty much written off and maybe by the end of it we will understand what if any roles are worth taking as a contractor.

but sub 500 I think it no longer makes sense to be in the freelance market as the risks are not worth the reward.

For the record it's not the tax that was the issue in all this its the removal of expenses.

**krytonsheep** · 5 March 2020, 15:57

Originally posted by babybel View Post

I can't help feeling that ultimately everything just comes back around and that market forces find their level in the end.

The CEO of Microsoft, says "all companies are software companies".

For a reasonable percentage of firms in the UK that's not too far from the truth. If companies can't recruit good permies and don't want to flush money down the toilet by outsourcing, then contractors are the only answer. If they struggle to get good people on inside IR35 contracts, they'll have to do outside IR35 contracts. Even HMRC themselves have contractors working on outside IR35 contracts, it's not a difficult thing to do.

Companies need to produce good working services / products, otherwise they'll become dinosaurs and die off. The companies doing blanket bans may find themselves in a year or two, failing to deliver anything because they don't have the caliber of people to do it.

**WordIsBond** · 5 March 2020, 16:30

We'll lose a lot of permietractors. We'll lose a lot of contractors going permie, retiring, etc. IPSE, QDOS, and a bunch of contractor support groups will hurt.

But an equilibrium will be reached.

**eek** · 5 March 2020, 16:31

Originally posted by krytonsheep View Post

The CEO of Microsoft, says "all companies are software companies".

For a reasonable percentage of firms in the UK that's not too far from the truth. If companies can't recruit good permies and don't want to flush money down the toilet by outsourcing, then contractors are the only answer. If they struggle to get good people on inside IR35 contracts, they'll have to do outside IR35 contracts. Even HMRC themselves have contractors working on outside IR35 contracts, it's not a difficult thing to do.

Companies need to produce good working services / products, otherwise they'll become dinosaurs and die off. The companies doing blanket bans may find themselves in a year or two, failing to deliver anything because they don't have the caliber of people to do it.

Microsoft have implemented a blanket ban..

**WordIsBond** · 5 March 2020, 16:42

Originally posted by eek View Post

Microsoft have implemented a blanket ban..

For Microsoft, failing to deliver a good product may not be a new experience....

**krytonsheep** · 5 March 2020, 16:59

Originally posted by WordIsBond View Post

For Microsoft, failing to deliver a good product may not be a new experience....

A friend worked for M$ in London on a new game. It was agile to the max with buzz words replacing normal dialogue. After about two years of sprints, they still had nothing playable, the project got canned and the studio was closed. What was funny though was their hiring technique. The windows logo has 4 colours and they used each colour to represent a type of person they wanted to hire. If someone came in, which didn't fit a specific colour, they would get rejected.

**bobspud** · 5 March 2020, 21:02

Originally posted by krytonsheep View Post

A friend worked for M$ in London on a new game. It was agile to the max with buzz words replacing normal dialogue. After about two years of sprints, they still had nothing playable, the project got canned and the studio was closed. What was funny though was their hiring technique. The windows logo has 4 colours and they used each colour to represent a type of person they wanted to hire. If someone came in, which didn't fit a specific colour, they would get rejected.

Nothing odd about that:

Leadership Personality Test

Works fairly well

**Lockhouse** · 5 March 2020, 22:14

Originally posted by bobspud View Post

For the record it's not the tax that was the issue in all this its the removal of expenses.

I disagree - certainly for me it's not being able to shield any fees for the inevitable fallow times encountered in a downturn. That's the killer.

Market Predictions for the Next Year?