Growth in IT contractor demand recovered in April 2023

Employers “hedging their bets” because they feel “uncertain” about the UK economy paid off in April 2023 for temporary workers – including skilled IT contractors.

In fact, as hirers grew “cautious about committing” to full-timers, triggering a seven-month high in temp billings, growth in IT contractor demand rose for the first time since January.

The Recruitment & Employment Confederation (REC) and KMPG, which made these observations of the labour market yesterday, now scores IT contractor demand at 53.3.

'Ongoing economic uncertainty'

With any score over 50.0 indicating growth, the April reading signals a recovery for IT contractors, as it compares to 50.7 in March, 50.6 in Feb, 55.0 in Jan and 52.0 in December.

Given KMPG says hirers in April felt constrained by “ongoing economic uncertainty,” the boss of Qdos, Seb Maley, is unsurprised that the flexible are back in vogue.

“In tricky economic conditions, businesses lean on the flexibility and skills of temporary workers – whether freelancers, contractors or umbrella workers,” he says.

'Temporary recruitment picture varies'

Neil Carberry, REC’s chief executive confirmed in the confederation’s Report on Jobs that ‘businesses turned to temps to help them through’ in April.

But in a sign that not all contractor prospects are equal, he said “the picture varies for temporary recruitment”.

Logistics, Driving and Food are struggling from changes in consumer behaviour, for example, whereas Technology has broken free from nearly flatlining for two months in a row.

But the picture varies further for temporary recruitment within technology, according to data from Indeed.com showing software development to be 'in the red' since the pandemic.

'Software Development weakening'

In a post on opportunities between Feb 1st 2020 and April 28th 2023, Indeed economist Jack Kennedy spoke of software development “weakening,” versus where software development postings were pre-covid.

But interestingly, “Software” skills and “Software Engineers” were in “short supply” on a permanent basis in April, according to REC member agencies.

Contractors specialising in “Software” -- not Software Engineering -- were similarly scarce last month, as were those temporary techies supplying Development, IT/Technology and Programming expertise.

'Plenty of opportunity out there'

“[It is] still a good time to be looking for a job,” said the REC’s Mr Carberry, in a social media post following the report's publication. “There is still plenty of opportunity out there for job-seekers.”

Releasing a report showing three out of four techies are dissatisfied at work (software developers were among those polled), Hackajob CEO Mark Chaffey saw fit to put employers on notice.

“Remember, tech talent are constantly on the look-out for a company that values work-life balance, diversity and inclusion, and a positive and supportive work environment,” he said. “By creating a company culture that fosters these values, organisations will be able to attract and retain top talent.”