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Demand for IT contractors on the turn, at last
Posted Oct 14, 2009
Our last summary of the state of the contracting market back in the summer showed that, while the demand for IT contractors continued to fall, the pace of decline had slowed.
Although reliant to some extent on anecdotal evidence, and statistics generated from contract roles posted online, there are signs that the general demand for contractors is showing the first signs of recovery since the summer, in line with tentative improvements in the state of the general economy.
Advertised contract roles on the rise at last
The job statistics website, Jobstats, derives its information from contract roles posted on the major job boards. Although not a precise reflection of the 'real' market, it does provide a good indicator of the overall health of the industry.
The number of contract roles posted remains lower than it did in the 2002-3 downturn - nearly 70% lower than it was in September 2008. However, following a quarter of stabilisation, the number of job adverts posted has risen by 6% since August 2009.
Contractor numbers up at leading agency
Matchtech, a recruitment agency which specialises in engineering, science and construction recently said that permanent recruitment had suffered more than its contract arm, with the latter now accounting for 73% of net income, up from 67% last year.
More significantly, contractor numbers have risen from 4,500 at the end of July to 4,630 at the end of September this year, however Matchtech say that they continue to experience margin pressure.
Other agencies report brighter forecasts
Over the past few weeks, several other leading recruitment agencies have also indicated that the market seems to have stabilised since the summer, although both contract rates and the margins agencies receive from clients remain under pressure.
In its last quarterly statement, Hays PLC reported a 41% drop in net fees compared the the same period last year, however the company stated that is saw the early signs of stability across a number of markets, which can only be encouraging.
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