CUK's IT Contracting Hotspots - an overseas guide

They are listed below in no particular order, but each of the following countries is busying the UK's IT recruiters by asking them to import IT contractors out of Britain and on to computer projects or programmes within their own national territory. Each one has a 'hotness' rating, based on the number of recruiters, or strength of the recruiters' evidence, backing that country to be actively hiring IT contractors from the UK. The stated rating should be notched upwards for those IT contractors who can speak that country's national language.

IT contractor hotspot: INDIA

Hotness Rating: 3/5

Although the world's classic destination for outsourcing is no longer as cheap as it used to be, India is a "definite hotspot right now for almost all IT skillsets", says Jenrick IT.

Managing director Philip Fanthom says his agents are fielding a growing number of requests for UK-based project contractors, willing to relocate to the country's technology hubs.

Demand in India for freelance computer skills is currently most visible from telecommunications firms, with some focus on IT contractors who have a strong background in Oracle BRM, and would accept long-term roles.

For these IT contracts, Indian client companies are prioritising the more autonomous freelancers, such as those contractors experienced at executing sub-projects based on the initial input of the architect and/or project manager.

The UK-based IT recruiter Arrows Group confirmed that India was no longer exclusively interested in IT candidates on the lower rungs of the jobs ladder, by saying demand for "highly skilled" technologists from the UK could increase in the coming months.

PRO: A rising number of India's new jobs require English skills. An estimated 333million people in India "use English," though India will need many more people speaking English to sustain its economic growth, according to a report by the British Council.

CON: Following a recession-induced recruitment lull over the past two years, India's IT and software body has frozen its annual hiring forecast, despite recruitment levels increasing for the first time in April 2010. At the time, Nasscom said ongoing caution among employers meant it was "too early " to raise its estimate of 150,000 new jobs incoming to the IT/BPO sector for 2011.

IT contractor hotspot: GERMANY

Hotness Rating: 3.5/5

Mainly thanks to its financial services sector, Germany tops the list of European countries driving demand for IT contractors on the books of Arrows. The Surrey-based agency reported that its German (and Dutch) clients were particularly interested in contractors skilled in Solvency II Project Management, and the niche modules in SAP.

Hays, the FTSE-listed recruitment firm, confirmed that Germany's financial employers were currently at the front of demand for UK IT contractors, particularly professionals with banking sector experience.

PRO: Some common ground with the UK on sought-after financial IT skills, including compliance, makes Germany an easier and more reliable customer than India for most UK-based recruiters. Also, Germany boasts improving tech and electronic sector credentials thanks to recently becoming China's biggest trading partner in Europe.

CON: The German economy failed to live up to expectations in July 2010 for the third consecutive month. Not unrelated, political momentum is meanwhile building for higher-rate taxpayers to pay more, potentially as much as 50% of their income.

IT contractor hotspot: SWITZERLAND

Hotness Rating: 4/5

Recruitment agents at Xtra IT say Switzerland is probably showing the biggest appetite for UK-based IT contractors out of all the EU member states. Unlike some of its neighbours, the country churns out a significant volume of English-speaking IT roles, as does the Netherlands.

However the firm's South European recruitment division says that in the Nordics, as well as in Switzerland and the Netherlands, clients will almost always take on a UK-based contractor with local language skills first, before considering one without.

But for Mark Rossiter-Smith, director of Hays Finance Technology, it is Switzerland that is Europe's second strongest user of UK-based IT contractors, in front of the Benelux region in third place. He said contractor pay rates within investment banks were starting to pick up, while rates more generally were also rising due to the release of new IT budgets.

PRO: Improving pay rates from new budget sign-offs in the financial sector, where IT contractors are needed for technical adherence to almost daily announcements by the regulator FINMA.

CON: A unique tax rate comprising federal, cantonal and local tax is applicable for UK-based contractors taxed at source, although this varies from one canton to another.

IT contractor hotspot: RUSSIA

Hotness Rating: 2.5/5

Not unlike Poland around the turn of the 'noughties,' Russia is seen today as the "up and coming" outsourcing destination of the moment, said Jenrick IT. The agency signalled demand focuses on UK-based development contractors, such as those skilled in C, C++ and UNIX.

PRO: Known for its competitive and vigorous science/technology base, Russia has both retained and attracted skilled technologists, known to have a knack for problem-solving.

Recent investment by a US private equity group in a technology hub at Skolkovo, a village outside Moscow, signals confidence in the political momentum to modernise the country. Another pull factor is a flat income tax rate of 17 per cent.

CON: Theoretical excellence among development houses does not always translate into commercial success. Other obstacles intrinsic to the country's make-up, such as red tape and corruption, are known to make conditions challenging for high-risk innovative businesses.

IT contractor hostpot: SINGAPORE (& S.E. ASIA)

Hotness Rating 3.5/5

Employers in South East Asia, notably in Singapore, are keen to encourage UK-based IT contractors into their ranks, says Hays' Finance Technology division. The firm says UK contractor demand in the region has increased, exerting upward pressure on pay rates, following the sign-off of annual budgets.

Adrian Treacy, director of specialist IT recruitment at Arrows, confirmed: "We are seeing a lot of companies using Singapore as a gateway to China.

"And with the current exchange rates the way they are, Singapore is definitely a good place for UK contractors."

PRO: The IT hiring intentions of senior executives in Singapore are slowly increasing, says a third quarter (2010) report published by recruitment firm Hudson. The recruiter points out that Singapore has attracted substantial investments from major international technology companies and financial institutions, which are establishing and expanding regional IT hubs.

CON: Notorious for high stress levels in the workplace, Singapore has been reluctant to pay the rates/wages that workers demand, but many HR departments are now signing off increases, albeit mainly to workers who clients/employers want to retain. Like Hong Kong, Singapore is often sought-out by UK IT contractors as the ideal overseas destination, often because of its infrastructure and location, but the various contracts on offer are likely to have limited prospects for renewal, unless the contractor speaks the national language.

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