IT contractor jobs market 'fiercely competitive' in September
“Fierce competition” in September dominated the jobs market, which for IT contractors may be levelling off -- albeit still at an enviably high level of demand.
Indeed, the REC said in a month where staff shortages caused issues at petrol stations and on supermarket shelves, its index recorded IT contractor demand at 68.9, versus August’s 70.8.
'Slightly slower pace'
Given any score over 50.0 signals monthly growth, September still saw a “sharp rise in hiring activity” said index partner KMPG -- yet for IT contractors, it was “at a slightly slower pace.”
The REC’s CEO Neil Carberry continued: “Demand for workers continued to grow last month… [just at the same time as] staff availability fell at a near record pace.
“[And] competition for staff has led to the fastest growth in starting salaries since this survey began [some 24 years ago].”
'Tens of thousands of ex-furlough candidates incoming'
Stoking the competition further, the end of the Coronavirus Job Retention Scheme is due to eject “tens of thousands” of candidates onto the market, warned KPMG’s head of education, skills and productivity Claire Warnes.
Contractors in the technology sector won’t likely welcome the newcomers however, because already in September except for IT/Technology generalists, only two skills were scarce on a temporary basis; Development and Software Engineering.
The REC’s list of “short supply” IT contractor skills being so short last month suggests the 24-year high in remuneration for new starters is paying off for employers.
'Surge in signing bonuses'
But Indeed.com has indicated that headline rates might be only part of the financial offering which engagers are using to tempt talent to go with them, and nobody else.
“The share of job postings advertising [so-called] ‘signing bonuses’….rose 75% in the three months ending August 31st,” said the site’s economist Jack Kennedy.
“While employers in some sectors have been raising wages in a bid to attract candidates, others have been focusing more on one-off financial incentives like bonuses for signing on.”
He added: “From an employer’s perspective, signing bonuses have the advantage of being a one-time cost that doesn’t require a permanent wage hike”.
But in exchange for the golden handshakes, deployed according to Mr Kennedy to help ease “hiring bottlenecks”, employers are insisting that candidates go through the wringer.
“After a month-long round of multiple interviews with a single company, I finally withdrew from the process last week,” began an “exhausted” candidate, who was told a new “debriefing” phase would soon begin if she wanted to land the job.
She added: “My ideal process is two interviews maximum, to be completed within two weeks when not hiring for an executive role, which I'm not applying for. [But] I met with six people over the course of four interviews.
“Incidentally, I was encouraged to look up each of these people I interviewed with, but it was clear only one of them had looked at my details”.
'Reskilling and job-moving needs speeding up'
In the REC report, KPMG’s Ms Warnes wrote: “The sharp rise in hiring activity is a reason to be hopeful, but competition is fierce.
“Reskilling and supporting people to move jobs which are in demand needs to be speeded up. Otherwise we may see these clear tensions in the labour market turning into a workforce crisis in many sectors.”
The recommendation comes amid reported admissions by white collar firms in London that they are turning away lucrative work because they lack the staff.
“Rising input costs and further tax rises would only mean higher prices and lower investment in the medium term,” says the Recruitment & Employment Confederation’s Mr Carberry, sounding aware of Autumn Budget on October 27th.
“It is essential that government works in partnership with business to deliver sustainable growth and rising wages, rather than a crisis-driven sugar rush. That includes working on policies that encourage business investment, an international outlook and skills development”.
According to REC member agencies, eight technology skills were scarce for permanent vacancies in September; notably the four affecting IT contractors plus BI, C#, Software, and Technical Management.