IT contractor demand hits its stride, as placement slump eases

A recovery, of sorts, in IT contractor placements went hand-in-hand in February with stronger demand for technology skills on a temporary basis, a staffing index shows.

So despite both hiring freezes and ‘take it or leave’ rate ultimatums last month, a slump in freelance IT placements shortened for another consecutive month, and demand hit its stride.

Specifically, a --38 % reading in IT contractor placements reduced to --11%, its least negative reading since Q1 2018, just as contract IT vacancies rose from 5.8% to 7%, found APSCo.

While the placements drop easing will be welcome, the uptick in demand – measured by new vacancies, is perhaps more significant, as it has been fluctuating around 5% since November.

That growth trumps the wider professional labour market, which is just “reassuringly stable” according to Ann Swain, CEO at the Association of Professional Staffing Companies.  

But the improvements in IT contractors’ prospects in February is yet to push up rates. According to the association, “levels for IT didn’t change from” January 2019.

Full-timers in IT were more fortunate, receiving 4% more cash in February but, unlike IT contractors, their demand is ‘in the red’ at --4%, a deterioration from -- 0.1% in December.

That goes against the grain of the professional labour market overall, indicated John Nurthen, a director at Staffing Industry Analysts.

“As Brexit discussion spiral into crisis, it’s interesting to see UK demand for talent holding up relatively well as temporary staffing markets in Germany, France, the Netherlands, Belgium and Italy stumble,” he said.

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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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