Current pros and cons of contract IT
Two surveys from the Recruitment and Employment Confederation (REC) and KPMG predictably indicate that employers are using temporary workers and contractors as a risk management strategy in the face of economic uncertainty . But IT and computing fell to fifth place, down from fourth place and now only coming after nursing and medical, engineering and construction,hotel and cateering, and blue collar workers in the comparable survey a year ago.
Commenting on the results of the Report on Jobs, a monthly survey conducted by NTC Economics on behalf of the REC and KPMG, REC CEO Kevin Green says, “Every week, 1.3m temporary workers are keeping business in the UK moving. Temp and contract work provides vital opportunities for workers.”
Temporary and contract billings were up again in May as survey panellists said firms are choosing this type of worker because of uncertainties about future business prospects.
REC also asked over 100 HR managers and business owners about how they use and perceive agency workers. Their main reasons for using a flexible workforce included:
- Exploiting new market opportunities
- Avoiding taking hasty decisions to recruit permanent workers
- Reducing the pressure on the existing workforce
- Filling specialist positions where permanent workers are in short supply.
Good news for contractors, is 67% of those surveyed said they hired a temporary or contract worker to fill senior and highly skilled roles, offering opportunities to work on enjoyable, meaningful and challenging contracts.
Commentators on both surveys have expressed concern over the outcome of June's EU Employment Council. According to REC’s Kevin Green, “…it is crucial that the detail of the proposed EU Agency Workers Directive which is being discussed in Luxembourg does not impact on the viability of the UK temp model."
Unless the UK can secure an amendment to the proposed EU Agency Workers Directive, the effectiveness of the UK’s flexible labour force that is so attractive to inward investors will be reduced significantly and the cost of hiring temporary workers will increase. That means the £24.6bn recruitment sector will take a huge hit, with contractors opting to work for clients direct.
Eight categories of contract and temporary staff covered by the Report on Jobs survey are showing an increase in demand. In all categories the survey shows stronger demand for contractors and temps than last month, compared with a decline in demand in four of the eight categories for permanent workers. So claims that firms are relying on contractors and temps to carry them through the tough times ahead have some basis in fact.
But while there are more opportunities for contracts, there are also more people on the market to fill them. REC’s Report on Jobs quotes anecdotal evidence that increased household costs coupled with the impact of the credit crunch is forcing many workers to seek second incomes. Increased availability of staff results in a downward pressure on salaries, putting employers in control of the market, with pay growth hitting a four year low.
Source: http://www.contractorcalculator.co.uk/