Demand for IT contractors in April 2026 enjoyed its biggest monthly recovery since February-March 2025, according to new data obtained by ContractorUK.
The temporary labour market in the UK for technology jobs is still not growing but, thanks to the big recovery, it is now on the cusp of growth (50.0), standing at 47.3.
UK plc “leaning more on temporary work” due to “uncertainty” stemming from the Iran war was key in April 2026, said the REC, which shared its Report on Jobs data yesterday.
When was the last time IT contractor demand recovered as much?
The report’s technology index shows that the last month when IT contractor demand moved towards growth more than it did between March (43.9) and April 2026, was back in Q1 2025.
Sara Burton, a fractional COO for recruiters, replied to the Recruitment & Employment Confederation (REC) when it posted the report’s publicly available findings on Monday.
“The US-Iran war kicking off at the end of February was a surprise to everyone,” she said.
“I think there was an initial thought that this would be brief and have limited impact, but recruiters are hearing hesitation from their clients, as they are concerned about interest rates and the ability to grow their business and headcount again.”
Can demand for IT skills on a flexible basis defy a cautious hiring approach?
SThree, which owns Computer Futures, a staffing firm specialising in IT, yesterday told ContractorUK:
“Research we conducted with CEBR shows the UK economy is increasingly reliant on technology‑led activity, with around half of UK STEM output coming from digital and tech‑driven sectors — helping explain why demand for flexible IT contractor skills may improve even when broader hiring remains cautious.”
Another key reason behind the shrinkage in the IT contractor jobs market slowing more in April than in any other month of 2026, was flagged up just a few weeks ago by Morgan McKinley.
Can essential infrastructure and security updates be delayed beyond Q1 2026?
In its 2026 UK Salary Guide, the recruitment agency said: “The outlook for 2026 is positive, as the suppression of technological progress and modernisation in sectors [such as] Banking, Financial Services and Insurance (BFSI) is considered unsustainable. This is particularly true in highly regulated industries such as cybersecurity.
“We envisage the end of Q1 2026 to be the point where the tide finally turns. Demand is slowly but surely increasing, suggesting that the current client-led cycle may be reaching its conclusion, as businesses can no longer delay essential infrastructure and security updates.”
Where are contractors increasingly being used?
City of London-focused, Morgan McKinley said in the month covering the REC data that it was seeing “contractors…increasingly utilised for the time-bound transformation phases.”
Appearing to refer to all three — digital transformation, infrastructure and security programmes — Morgan McKinley added in its 118-page guide:
“We’re seeing a continued rise in demand for highly-skilled contractors who can step into complex programs, deliver immediate impact, and help organisations navigate change confidently.”
How is IT contractor availability in Q2 2026?
On the ground, though, temporary IT job candidate availability was reported in April 2026 to be high, potentially explaining why, despite the war and cycles helping, their market remains in negative territory (according to the REC data).
“IR35 [reform] largely broke the contract market. Clients blanket assessed everything inside…rates didn’t move, so massive numbers of good people did the numbers and went ‘perm,’” began Howard IT Recruitment in a LinkedIn post.
“Then came the redundancies, restructures, mergers, [and] realignments. A lot of these same people, now with even more years of serious programme delivery behind them, have found themselves back in the market, often at relatively short notice.
“In other words, the pool IR35 drained is refilling. With ex-contractors and those who have never considered contracting before.”
Are experienced, decent recruiters easy to come by?
A Change Consultant, Julie Brown, echoed online that the competition for non-permanent roles in April 2026 was strong-to-fierce.
“The market is now awash with many decently experienced contractors and potential contractors.
“[And unfortunately] experienced recruiters, who have long-standing relationships with their clients and a solid understanding of what it is their clients need, are few amongst the many.
“I look forward to securing a new interim role, but it’s not been the easiest of hunts this [month].”
Which IT jobs have the highest pay growth?
High candidate availability for temporary roles might explain Morgan McKinley’s more granular findings on IT sector pay and rates.
“Growth [in remuneration] is increasingly concentrated in a small number of high-demand specialisms such as AI, Cloud Computing, [and] Compliance Technology.
“[Therefore] professionals with specialist capabilities in AI, private capital, compliance technology, and digital transformation are commanding strong premiums…[whereas] those in more traditional or generalist roles face a tougher negotiating position.”
What are many employers recognising about buying IT skills?
However, David Neal, managing director of Morgan McKinley, spoke of “many” firms now “recognising that they cannot ‘buy’ all the skills they need, prompting increased [internal] investment”.
The internal investment focus chimes with 2026 being a hiring “landscape where talent is treated less like a cost line and more like a strategic lever for protecting margins and adapting to volatility,” said Mr Neal, who added:
“Organisations continue to treat technology investment as a strategic priority, and professionals at the intersection of technical capability and business delivery [can] command a meaningful…premium.
“[But] clients have become ever more selective when sourcing talent, and expect a much higher percentage match to their job specs than before.
“From a candidate perspective, differentiation is now essential.
“Professionals with niche technical expertise, strong personal branding, and the ability to navigate AI-assisted recruitment processes are best placed to succeed.”
Which IT jobs are in demand in the UK?
According to the Morgan McKinley UK “Salary” Guide 2026 (which indicates the following relate to the full-time IT labour market), the six most sought-after tech jobs this year are:
- Software Developers
- Cybersecurity Specialists
- DevOps / DevSecOps Engineers
- Cloud Computing Specialists
- Data Analysts
- AI and Machine Learning Engineers
How is the software engineering jobs market?
In line with the City-focused IT recruiter’s outlook for 2026 (“modest and steady growth rather than a rapid boom”), a consultant at Manchester-based Oscar Recruitment, Matthew Holt, told his ‘followers’ in April 2026:
“Larger technology employers, who dominate software engineering hiring, have reduced vacancy volumes but have not stopped hiring.
“What has changed is selectivity. Hiring managers have more applications per role than they did in 2022. The filtering at CV stage is faster and less forgiving. The candidates who progress are those with demonstrable production experience, not just documented skills.
“For software engineers considering a move, the market is tighter than it was, but not closed.”
Which IT roles were in short supply in April 2026?
According to the REC, software engineers, as well as software developers — plus software generalists — were “in short supply” in April 2026, for both temporary and full-time jobs.
Scarce on only a contract basis last month (according to the confederation’s member agencies) were Software Architects, IT Systems Engineers, IT Procurement Specialists, Technical Designers, Technical Managers, Data Engineers, Full-Stack Developers, and IT/Technology skills.
In line with Morgan McKinley’s ‘sought-after six’ for 2026, the agencies reported AI/ML Engineering and Cyber Security contractors in short supply as well.
What UK full-time IT workers are in short supply?
The REC’s agencies filling tech positions on a full-time basis reported the same scarcity of AI/ML Engineers, Cyber Security specialists, and, further in line with the ‘sought-after six,’ Cloud Engineers.
Permanent vacancies also struggled last month to attract enough Analysts, Data Centre Specialists, Data Professionals, Data Engineers, and IT Procurement Specialists, the REC added.
The Report on Jobs additionally found shortages in April 2026 of full-time applicants for positions requiring CNC, C#, IT and Software Sales, IT/Technology, Technical, Digital, and IT Infrastructure skills.
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