Pre-referendum boost for IT contractors peters out

The small uplift the Brexit brought IT workers who are temporary or freelance petered out in June, shows the latest Report on Jobs.

In fact, growth in demand for IT contractors fell in the referendum month to one of its lowest readings of late -- 52.8, a figure last recorded by the report in the challenging first quarter of 2013.

Although the 52.8 score means demand for contract IT staff still grew in June (any score over 50.0 implies stronger growth than the previous month), it is the lowest since December 2012.  

It is also lower than in the previous report in May when, in the weeks preceding the EU vote, end-users reversed the trend of growth in demand for IT contractors slowing, resulting in the first increase this year in their index score.

The subtext is that while the run-up to the June 23rd poll saw “many” firms hire “contractor or interim staff to hedge against potential changes,” as the REC says, the aftermath has not followed suit.  

Instead, it seems that ongoing uncertainty over the detail of those potential changes has affected hirers’ interest in even non-permanent workers -- the candidates who are the easiest for firms to take on, and let go if conditions worsen.

Kevin Green, REC’s CEO appealed: “The best thing for business right now is clear and calm leadership and as much clarity as possible on what the post-EU future will look like.”

The best thing for IT job candidates is less clear. Before the Brexit vote, there were 12 IT skills where demand was outstripping supply, whereas now there is just one -- contract web development.

“Before the referendum, businesses were already finding it increasingly hard to source the right candidates,” Mr Green said. “Ensuring employers can still access the people they need to succeed must now be top of the list in any negotiations.”

He believes that the best way to ensure the continued health of the professional labour market is by maintaining membership of the single market and access to skills across the EU.

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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