Growth in IT contractor demand recovered in June 2019

Growth in demand for freelance IT contractors who use recruitment agencies recovered in June from its 83-month low – albeit only just.

Scored by staffing body the REC, the demand crept up over the last four weeks to 53.2, from the May low of 51.2 but -- except for it – still representing the weakest score since late 2012.

“Brexit stagnation continues to seize up the jobs market as the slowdown in recruitment activity continues,” said James Stewart, chair of KMPG, which co-authors the REC’s Report on Jobs.

'Unlikely to bounce back'

“Growth in temporary billings remained historically weak [and] as we approach the summer holidays, the worry is that vacancy growth…is unlikely to bounce back.”

On top of Brexit and the usual summer hiring hiatus, political limbo around the UK’s leadership was also said to be behind end-users looking to maintain a “relatively cautious approach”.

However, a separate survey of more than 100 leaders within technology start-ups suggests a new occupant at No 10 Downing St. won’t mean much to almost half of the IT-led business sector.

In fact, Studio Graphene found that 51% of the start-ups believe that a new prime minister will impact their growth prospects, compared with roughly the same, 49%, who say it will not.

'Computing needs more workers'

“IT & Computing continued to need more workers”, said KMPG’s Mr Stewart, in a reading of the REC report that applies to the contract market but only just, as 50.0 is the growth threshold.

Neil Carberry, chief executive of the Recruitment & Employment Confederation (REC) added:

“Slower growth of temp billings is a reminder to all politicians that businesses…across the country are looking for a smooth path to a negotiated Brexit outcome.”

'Opportunities for temps'

But Mr Carberry repeated his warning to policymakers, which he first sounded in the nadir IT contractor recruitment month of May, that it’s not just Brexit which needs fixing

“It is high time that this policy [the Apprenticeship Levy] was reformed.

“By allowing agencies to fund high-quality training for temps using the levy they pay, the government could provide progression opportunities for flexible workers, tackle the country’s skills shortages and boost the productivity of our economy.”

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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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