Demand for IT contractors pulled nearer to growth in August

IT contractor demand continued its climb towards growth in August, pointing upwards for the fourth month in a row thanks to key sectors of the economy emerging from covid-19 lockdown .

In fact, demand for IT skills on a contract basis rose from 40.2 to 45.8 -- still some way off the 50.0 growth threshold, but representing its highest score since the pandemic hit.

Agency staffing body the REC, which released these figures from its index yesterday, says Technology as a whole is firmly among the sectors “coming back strongly” since lockdown was eased.

'Temp hiring much stronger'

But in an online update, the REC’s chief executive Neil Carberry said temporary hiring was “much stronger” than permanent hiring, and seemingly not only because of covid restrictions easing.

“Temp always bounces back faster in the early stages of a recovery -- we think this is especially pronounced this time as clients see demand now, but have no clarity about the medium term, given the virus and -- increasingly -- no-deal Brexit risk.”

Pressed about why temps have the edge, Mr Carberry said in a BBC interview that, due to Brexit and covid risks, ‘companies just don’t know what the path ahead looks like.’

'We can get candidates cheap at the moment'

He also said that a massive spike in candidates (the REC counts availability to be at its highest level since the 2008 financial crisis), was not a cause to treat them any different or worse.

“The ‘we can get candidates cheap at the moment’ [mentality] is [unfortunately] starting again,” agreed Mark Thomas, partner at tech leadership jobs agency Eames Consulting.

Addressing his fellow recruiters in a post, he added: “Pay people what they are worth. Don't low-ball someone just because you can. It's not good business, it's short-sighted.”

'Many challenges ahead'

“Total candidate availability [is] rising at a near-record pace,” reflected James Stewart, vice chair of KPMG which co-authors the REC’s Report on Jobs.

“[Therefore], strong and sustained rises are needed to move the UK jobs market back to levels seen pre-covid -- and with concerns around a possible second wave of infections, the winding down of the furlough scheme and a Brexit deal outcome, there are still many challenges ahead.”

Nonetheless and for now, he said the uptick in hiring “particularly for temporary” workers was “positive to see”, and could “mark a turning point” in terms of engagers’ willingness to hire.

'Resist carpet bombing'

Asked in his interview to offer job-seekers some tips, the Recruitment & Employment Confederation’s Mr Carberry advised, “don’t lose heart” and resist the “carpet bomb approach.”

The advice came after one PM took to LinkedIn to suggest she had lost heart (at times), but finally succeeded after winding-in the very same ‘spray and pray’ strategy for CV sending.

“My contract finished at the end of May and life has been applications after applications. Knock backs after knock backs”, said the project manager, Claire Rooney. 

'Hang in there, it'll come'

She added: “It’s been pretty bleak as it’s so incredibly tricky out here. I’ve felt as if I will never get a role. So many people [are] after so few roles, and my confidence was beginning to plummet.

“But last Friday, I had some great news. I have secured a PM role!

"I just want to give some reassurance to everyone out there looking -- there’s a role out there with your name on it so hang in there, it’ll come.”

'Retrain and upskill'

However, those roles reaming elusive to full-time IT recruiters include Agile PMs, Analysts; Business Intelligence, C#, Cyber Security, Data Scientist, Database Developers, Software Engineers, Developers, Java and Technology/IT/Digital.

Also declared scarce in August, albeit by the REC’s contract IT agencies, were freelance Programmers, Data Scientists, Developers, Database Developers, IT/Technology and Java.

“A reduction to employers’ National Insurance Contributions, and greater flexibility on skills support would both help firms to maintain jobs and hire more people,” said Mr Carberry, appealing to government ahead of Autumn Budget 2020.

At KPMG, Mr Stewart echoed: “Government [ought] to not only provide short-term support but also to offer job-seekers the means to retrain and upskill, helping the recovery in jobs and reviving the UK’s productivity growth.”

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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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