IT contractors are benefiting from cautious employers, says Reed Technology

IT contractors will be in high demand at the start of 2012 as companies are confident enough to start new projects, but not confident enough to take on permanent staff, according to recruitment consultancy Reed Technology.

This is the case across all industries, according to Andrew Gardner, senior divisional director at Reed Technology.

"We've noticed more contract roles across the board. In the short term, I expect contract numbers to increase because some clients may be nervous about starting projects with permanents," Gardner said.

Gardner expects next year to be one of "cautious recovery", because of the critical role that IT now plays in business.

He said: "Businesses almost can't do without IT now. It's not an optional service.

"I don't see the bottom falling out of [the jobs market but] I don't see an enormous boom [either]."

In terms of sectors, Reed Technology believes that there will be a growth in job opportunities in the retail sector next year.

"A few retailers have been under-prepared for the traffic through their website. [But] retailers generally tend not to touch their systems in December because it is such a key time for them. So next year, they will be looking at web capability," Gardner predicted.

Conversely, Reed Technology has noticed a slowdown in jobs in the financial services IT sector, which is unsurprising given the current economic crisis and the banking reform that the government is enforcing on the industry.

This has led to large banks like Citigroup, Credit Suisse, UBS and Lloyds Bank cutting IT jobs in order to reduce their costs.

Meanwhile, recruitment processes are also taking longer, going from four-week cycles to six- or seven-week cycles.

"There is more caution and more hoops to jump through in the interview process. Historically we'd have three interviews. Now we are seeing more," said Gardner.

But he said it was better than what usually happens in previous downturns, with roles getting pulled or shelved.

"We're not seeing that so much this time, which I suppose is positive," he said.

Reed Technology has also noticed specific trends taking place in the public sector.

According to Gardner, there seems to be a realignment of permanent public sector staff salaries with the current market rate. He said that in many cases, the public sector pay is higher than the market rate, due to annual salary inflation, and particularly if employees have been in the public sector a long time.

However, he suggested that the public sector recession this year has not been as severe as expected due to activities such as this pay realignment and the controversial pensions renegotiations that led to the national strikes last month.


Copyright © 2011 IDG Communications, Inc.

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