Clients told to stump up premiums, as IT contractor demand continues to soar

Already historically high demand for IT contractors accelerated further in July 2021, making now the perfect time to switch for better work -- or money, or both.

Admitting that conditions are almost at optimum for such temporary candidates, staffing body the REC spoke on Friday of hardly a “better time to be looking for that new role or contract.”

There are “big increases in starting rates, especially for IT contractors who the body says saw demand for their skills rise from 71.2 in June (which was a 23-year high), to 71.8 last month.

'Listen to your agency, if told the pay picture has changed'

But it appears that not every end-user is willing to suddenly pay premiums for freelance technology skills, even if the market indicates that they may now be due.

Taking to LinkedIn after the figures were published, the REC’s CEO Neil Carberry warned “client companies” that they “need to be aware of” the big rate increases when their agent explicitly “tells you the picture has changed.”

Even then, “pay alone won’t do it” cautioned REC’s deputy CEO Kate Shoesmith, also in a post yet advising clients who were not resisting offering higher rates but who were still struggling to secure talent because of the “candidate-short market.”

'Reskilling and upskilling'

“Candidates can want flexibility; a better work-life balance [and] the right [overall] package,” she further advised.

“What is also clear is that unless we get the development and training right, we won't have suitably skilled and qualified people to do these roles at all.”

Claire Warnes, partner at KMPG, agrees, saying that with “low candidate availability” continuing, “reskilling and upskilling” is necessary to help workers move between sectors.


Writing in Report on Jobs by the Recruitment & Employment Confederation (REC), Warnes said the “pingdemic” had added “an extra dimension to the recruitment challenge.”

But from the perspective of candidates like contractors, the challenge is cutting through the increasing white noise emanating from job adverts.  

“The number of [agents who] post job listings that think having statutory holidays or a company pension is a ‘benefit’ is farcical. Those are legal requirements, not benefits,” one candidate began.

“[Second], the number of [agents who] want me to apply but won't tell me what the salary is until I do so is beyond measure. Matched only by those who do publish salaries but are looking to pay mid-weight levels for exec-level roles!

“[And finally,] a six-stage interview process lasting over a month? No thanks. All that says to a candidate is that your process and decision-making capabilities are nightmarish and your company is to be avoided.”

'It's quality hiring practices in short supply, not candidates'

A UX specialist, the candidate also told agents: “You may have the greatest role in the world, but it you're throwing obstacles in the way of hiring the greatest person for them, it's not the candidate, it's you.

“So it's not quality candidates that are in short supply, it's quality hiring practices.”

As to candidates recorded by the REC to be in short supply in July, for both permanent and contract opportunities, they were in Development, Software Engineering, Data, Digital and Technology/IT.

'Employers are desperate'

There was also a shortage of cyber contractors, alongside a dearth of full-time applicants for Agile Project Management, Automation Testing, Azure, BI and C# positions.

The confederation’s Ms Shoesmith said: “Employers are desperate to find good candidates for the many jobs on offer and this is reflected in starting salaries rising at the sharpest rate since the [Report on Jobs] survey began in 1997. This will likely motivate more people to be on the lookout for new opportunities. The same goes for those on temporary contracts which are also seeing increased pay.”

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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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