E-Skills, the UK sector skills council for IT and telecoms, confirms in its latest bulletin that vacancies and rates have plummeted, although there are glimmers of light in some areas.
The number of advertised contract vacancies in the IT contracting market has fallen by over a third, to 15,000, since the last quarter of 2008. And rates for contract IT positions have dropped by 1% in the same period, to an average of £1,400 per week. This equates to an average day rate of £280 and an hourly rate of just over £37, compared to average weekly income of £800 for permanent IT employees.
However, a survey of IT contractor hirers by the Institute of Chartered Accountants in England and Wales (ICAEW) shows confidence in the sector has increased slightly from -33 to -32, and the number of liquidations of IT firms decreased by 25%, indicating that market conditions might be starting to stabilise.
Selected skills show increased demand
Whilst the overall number of contracts has fallen, some skills saw an increase over the period and one, Sage, has seen an increase over three consecutive quarters. The top ten IT skills featured in adverts for contractors were:
- SQL
- C
- C#
- .NET
- SQL SVR
- Java
- ASP
- Oracle
- C++
- HTML.
Conversely, demand for permanent IT staff in 23 skills areas has seen an increase, with HTML increasing in demand over two quarters.
IT clients slow down hiring
Despite the slightly improved confidence shown by IT firms in the ICAEW survey, there are fewer recruiters now than in the previous quarter and where hirers reported on hard-to-fill contracts, they were most likely to be in the following areas:
- Systems development
- IT management
- Programming
- Systems design.
The number of advertised contract vacancies in the IT contracting market has fallen by over a third
Of the 65,000 permanent and contract IT professional workers looking for work in the period, 30% were IT managers and 33% software professionals, with most having been looking for work for less than three months.
Unemployment in IT at five-year high
Unemployment for all IT workers, including IT contractors, is at a five-year high, at 4.8%. However, this compares favourably to the rest of the workforce, which is suffering an unemployment rate of 7.3%.
And whilst the news might seem gloomy, it is worth remembering that employment levels in IT remain at a historically high level. E-skills says there are actually 4% more workers in the sector than a year ago, indicating that the IT sector is still showing overall ongoing growth, with the number of workers entering the sector steadily increasing.
Whether the drastic falls in available contracts is part of a longer-term trend remains to be seen. But historically, IT contracting has shown itself to be remarkably resilient, clearly demonstrating the value that UK organisations place on flexible, highly skilled IT contractors.