‘Stable’ IT contractor demand moved near growth in February 2026

Demand in the UK for freelance IT contractors took another full-index-point step towards growth in February 2026.

According to the REC, demand for technology skills on a temporary basis stood at 47.6 last month.

It represents the largest score on the temporary IT/Computing skills index of the Recruitment & Employment Confederation (REC) since May 2025.

Was IT contractor demand in February stronger than in January?

February's score of 47.6 also represents a significant improvement on January 2026, when IT contractor demand was even deeper 'in the red' — at 46.6.

The REC's full index for contract IT/Computing workers, obtained by ContractorUK, measures growth in the temporary technology labour market at 50.0 and higher.

Is the IT contractor jobs market at a recent high?

Except for May 2025, the last time that the REC's index showed a higher score for temporary IT/Computing workers than in February 2026 was November 2023.

Put another way, other than the previously larger uptick for IT contractors nine months ago (when mothballed tech projects were clearly taken off the shelf), prospects for temporary technology workers appear to be at a 27-month high.

So while "February's report is by no means a source of unalloyed celebration, it does suggest that the worst of the hiring slowdown has passed," says REC's Neil Carberry.

Mr Carberry was speaking about the UK recruitment market as a whole, rather than the contract IT labour market specifically.

Does uncertainty favour temporary IT hires like contractors?

However, another of his comments about hiring overall indicates a potentially fertile environment for temporary hires, who can be taken on and let go more easily than their permanent counterparts.

The REC's chief executive, Mr Carberry said: "There may still be a few bumpy months to come, especially in light of global instability.

"But the stabilising trend we have seen so far this year has continued. It is notable that regions and sectors most exposed to the industrial strategy seem to be the liveliest."

How is the technology labour market faring?

A technology staff recruiter, William Harris, characterised IT hiring last month as measured.

"The 2026 hiring market isn't chaos. It's not a boom either. It's more…controlled breathing," began Harris, an IT recruiter at Morela, an emerging tech jobs agency.

He added that companies were hiring in February, "but carefully," meaning "every headcount [addition] feels like it needs three sign-offs and a finance blessing."

Can technology workers still name their price?

"Hiring processes? Slower. Budgets? Scrutinised. Salary wars? Mostly over," continued Harris. "The Wild West days of 'name your price' have cooled off."

Jon Holt, group chief executive of KMPG, says stability is what UK employers need.

"We need stability for sustained growth…yet again, businesses are facing…unexpected economic shocks because of global events out of their control.

"Resilience is now the new normal," Mr Holt said.

"So it is likely we may see these signs of recovery stall again in the near term as chief execs take stock."

How many technology job layoffs have there been in 2026?

Technology roles on a permanent basis do not appear to offer IT contractors any sanctuary, as they lack even stability, especially in the US.

"Data shows that roughly 9,238, or about 20% of the 45,363 tech layoffs recorded worldwide since the start of the year, have been linked to AI implementation and organisational restructuring," says Alan Cohen, data analyst at RationalFX.

"The largest contributor to these reductions is the American technology firm Block [which has announced] 4,000 layoffs."

In line with 4% of contractors' fears about AI, Cohen said Oracle has announced 254 AI or restructuring-induced layoffs, eBay has announced 800, and Pinterest has announced 675 terminations.

Does top IT talent still have options?

"Top talent still has options," reassured Morela's Mr Harris, who specialises in permanent IT placements.

"This isn't boom or bust. It's a thinking market. And honestly? After the last few years… that's probably not a bad thing."

What IT contractor skills were in short supply in February 2026?

According to the REC in February, shortages of contract IT skills extended to Cyber Security, Data Engineering, IT Infrastructure, Senior IT Developers, Software, Software Architects, Software Developers, Software Engineers, Software Trainers, Technical Managers, Technical Roles and Technology/IT.

Full-time technology recruiters reported ten of those scarce IT contractor skills in "short supply" last month across their own vacancies.

Where are full-time IT jobs short of applicants/skills?

The ten in short supply were: Cyber Security, Data Engineering, IT Infrastructure, Software, Software Architects, Software Developers, Software Engineers, Senior IT Developers, Technical Roles and Technology/IT.

February 2026 also saw applicant-shortages for permanent tech positions requiring AI/ML Developers, Automation Testers, BI Developers, CAD/CAD Modellers, Cloud Engineers, Data Centre Network, Data, Data Science, IT Audit, IT Directors, IT Helpdesk and SMT Engineers.

How is IT contractor demand in London's financial district?

Last night, Natalie Bowers, founder of Bowers Partnership, which places IT contractors in London's Square Mile, told ContractorUK: "February definitely felt busier for IT contractors across Investment and Wealth Management after a long, quiet spell.

"I'd like to see three months of improvement before calling it a 'trend' rather than a 'blip.' But for the first time in a while, it feels like the contract IT market might finally be waking up — from a long snooze."