Tag Archive | "it contractors"

1 in 5 Self Employed Workers Are “Insecure”

We all know how common self employment is becoming in the UK, but is everybody satisfied? According to new research…NO!

This research came from the CRSE, also known as the Centre for Research on Self Employment, and the IES, also known as the Institute for Employment Studies…they both teamed up for a joint venture to find out more about the self employed community.

The community includes contractors and freelancers of course, which is becoming a common choice for people who want to quit their job, work for themselves and make more money.

Anyway, one of the most interesting statistics to be uncovered during the research is the fact that 1 in 5 self employed are what they call “insecure,” which amounts to roughly 825,000 workers.

What exactly do they mean by insecure anyway? Apparently it is those self employed workers who are on low pay and dependent on one main employer to give them work on a regular basis. They say this includes workers such as cleaners, drivers, and labourers.

Who knows exactly if this is true or not. For all we know, this report could be a complete waste of time by the CRSE and IES, and would find its true place in the bin (which I’m sure is where many of these research projects end up).

On the other hand, they could very well be onto something here, and perhaps nearly a million of our nations self employed are “insecure” and in need of help.

The other end of the spectrum paints a rather different picture however, as the research shows us that 198,400 of self employed people have high pay, mid-independence and are secure, while 162,000 have high pay, complete independence, and yes…security.

I’m sure this includes a lot of contractors and freelancers, because from what I’ve been hearing the job market in this particular self employment niche is very secure right now, to the point where many are going home with bags of cash each and every week.

This certainly is a boom time for anyone that wants to call themselves a contractor or freelancer, as companies need the talent and are willing to pay top money in order to secure it.

Make no mistake, there is no “insecurity” to be found here. Take IT contractors as a perfect example, who are really in demand right now and can sometimes command a stunning £700 a day for simple tasks.

It’s a goldmine no doubt, but will it last? Experts are often debating this very question, but in my opinion, I think if you have the skills then you should always be able to get good work and be well paid. No need to be insecure at all.

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Factory Workers, The New Work From Home Contractors…

Working from home has typically been the domain of so called white collar workers such as IT professionals. Not for long it seems.

Blue collar workers as they are known, such as factory workers could very soon find themselves sitting on the couch with their white collar brothers and sisters. The reason? Robots and Virtual Reality.

That’s right. If you thought robots would be taking over the factory jobs then you might want to think again. Sure, they are going to be on the production line doing the actual work, but it is still going to be humans controlling them…for now anyway.

A Virtual Reality headset is currently in production that would allow your typical factory worker to put it on in the morning, just like they were putting on their uniform, and then see everything the robot is looking at on the production line.

The factory worker contractor would then have the ability to control the robot from the comfort of their own home. If the television is on in the background it doesn’t matter, as long as the robot gets the job done.

I’m sure these Virtual Reality workers will even be able to control when the robots go for a tea break or even a quick snooze. Just don’t let the factory foreman find them or they could find themselves down the robot job centre.

Recent statistics show that when humans and robots work together in a factory setting through the power of Virtual Reality then tasks are done 57% faster than when humans or robots work on their own. Also, it was found that robots are 95% better at grasping objects when they have a human controlling them.

Even better, these robots can be controlled from hundreds of miles away by a Virtual Reality contractor, which means that you could potentially have a home worker in Glasgow controlling a robot worker in London.

It’s even possible that we could start to see international partnerships forming, where humans and robots from different countries pair up to work together

So do you even have to be an experienced factory worker to get into this whole Virtual Reality thing anyway? Apparently not, as research shows that the best candidates for the job are…video gamers.

The job advert could very well read – “work from home video gamers needed, to put on Virtual Reality headsets to control robot factory workers.”

I’m sure the advert would get a lot of replies, especially if the pay was good and you could do everything from the comfort of your sofa.

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Do You Pass The IR35 Public Sector Test? Most Do…

A well known and respected tax advisory company have recently done some research, and what they found will surprise many, especially in the public sector.

It was the public sector where this research was carried out you see, and the subject on the top of the list was the dreaded “IR35 reforms,” which thousands of contractors around the country have been complaining about of course.

Do the majority of public sector workers even have to take part in this whole IR35 thing, anyway? According to the new research…maybe not.

What they found is that 89% of the people surveyed passed their unique IR35 public sector test, which was a detailed status assessment that really put contractors through their paces.

The end result of all of this was that most contractors “sit outside of IR35,” which means they won’t have to bow down to the recent changes which came into effect on April 6th and have been the subject of much controversy

At this point I would just like to point out that all of this research has been carried out independently by a third party company and has nothing to do with the government at all.

In other words, if you are a public sector workers then don’t expect to turn up at work tomorrow and be told by your boss to forget about IR35.

This is a view shared by the tax advisory company who did the research, as although they were very sure of their findings regarding IR35 and public sector workers, they did go on to admit that every case needed to be reviewed individually by a government official.

They also went on to add that most of the public sector contractors surveyed worked in the IT industry, which does appear to have a higher pass rate than other industries.

No matter what industry you work in…the word on the street is that freelancers and contractors everywhere feel completely unsupported by the government.

In a shocking survey conducted only a few months ago, it emerged that a staggering 97% of self employed workers have no belief in the current regime at Number 10.

That is definitely a lot of people, and it makes you wonder how the Tories even got re-elected in the general election. They did of course, but only just.

The IR35 changes have obviously played a major factor in the distrust between hard working contractors and the government, but also the ridiculous tax grab and other issues that have become apparent.

If you are a public sector contractor then you might want to contact a specialist tax firm who can advise you on the best way forward regarding IR35.

However, you could also join the thousands of public sector workers who are leaving and moving into the private sector, where many say the opportunities are in abundance and the money is a lot better. The choice is yours.

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“DON’T Show Me The Money,” Say Contractors

Working is all about that money, wouldn’t you agree? Apparently not, as a recent survey found that in the contracting world other things are more important.

The survey was conducted by a contractor tax advisory firm who wanted to gain an insight into exactly how UK contracting professionals think and act. The results of the survey are fascinating

What they found is that 48% of contractors said that more independence and control are the main reasons why they wanted to become self employed in the first place. No doubt they were frustrated with lack of control when you have to bow down to a boss every day. Look who’s laughing now though.

Compare this to only 31% of contractors who said they were doing it primarily for the money, and it’s plain to see that many of our nations self employed, and particularly contractors, prefer being in control of their own destiny over taking home a big bag of cash at the end of the week.

That isn’t to say that contractors don’t care about money. Of course they do. It’s just that it isn’t their number 1 motivating factor in getting up everyday and looking for contractor jobs.

The survey asked 715 contractors their opinions, so you can be sure the answers come from a broad spectrum within the industry.

Other statistics uncovered by the tax advisory firm include the fact that 12% of contractors make it a main priority to strike a good balance between work and life. In other words, they take their work seriously, but also want to have some good times as well.

Compare this to your average worker drone who slaves away for 12 hours a day, 5 days a week, and it’s easy to see why the world of freelance contracting has become so attractive in recent years to the UK public.

9% of those surveyed did put themselves in the “other reasons” box when asked about why they became a contractor. Some might have been made redundant for example, while others just wanted to give something else a try, no doubt.

A spokesperson for the company behind the survey had this to say: “Self employment gives people more freedom and control over their careers and lives, and the largest proportion of contractors state this as the main reason for striking out alone simply highlights that independence is priceless.”

Well said by the spokesperson if you ask me. I think they understand exactly what motivates a lot of contractors right now in the UK.

Where exactly in the contracting world is independence valued the most? According to the survey that prize goes to IT, where self employed IT contractors really do enjoy having the freedom to more or less do whatever they want.

The good news is that IT contractors are also paid very generously, especially in certain areas of the IT market where many skills are highly sought after.

So IT contractors are having their cake and eating it too, and with the vast majority of other contractors enjoying their cake…the future is looking bright in the UK contractor scene.

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Research Confirms IT Contractors Leaving Public Sector

One subject I’ve talked about before is how IT contractors would be leaving the public sector once those unpopular IR35 tax changes came into force.

Well, it looks like I have been proven right, because new research has just confirmed that IT contractors are jumping ship and going elsewhere…mostly to the private sector where they are not subject to this IR35 madness.

Who can blame them though? At the end of the day, if you are getting money taken out of your pocket, which in your view is unfair, then of course you are going to down tools at the first available opportunity and seek out new opportunities.

The IR35 tax reforms came into effect during the month of April this year, and it means that IT contractors get taxed like an employee, which ultimately leads to a more expensive tax bill with some reports suggesting that it is costing 25% more than before. Not surprisingly, the vast majority of workers were, and are, outraged.

So what has the new research found out about IT contractors, the public sector and IR35? The first statistic that caught my attention is that 71% of those surveyed admitted that their income had taken a hit since the new tax changes.

A third of that 71% mentioned they now take home 15% less in their pay packet, while a further quarter said they were getting 25% less.

Out of the 1000 IT contractors surveyed, half said they had already or were planning to leave for the private sector, while 75% said the private sector is the place they would most like to be.

Who can blame them? In my opinion, there has never been a better time than right now to find an IT contracting job in the UK. Many companies in the private sector are actively looking for a wide range of skills, and if you have the talent, then you should be taking home a nice bit of change every week.

Not everybody agrees though, as the survey went on to show that 6% said they were sticking with their IT contracting jobs in the public sector and it was the best place to be.

I’m sure that some people didn’t get affected as much by the IR35 tax changes, and this is why they are content to keep on working in the public sector.

Recruiters have also had their say, with 77% saying that the private sector was now the most desirable place for IT contractors and 59% admitting that digital skills were lacking in the public sector.

This has led many experts to say that project delivery is now a concern within the public sector, and that a lot of projects will never see completion

Just look at the whole “making tax digital” saga as a perfect example of this. For a few years now it has been in the works, and then, unexpectedly, it was scrapped. Perhaps they no longer have the IT skills to make it happen? Who knows for sure.

What I do know that is many IT contractors are now moving boldly forward to a new and exciting life in the private sector, where more opportunities and money awaits them.

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Demand for IT Contractors Strong in May

If you thought IT contracting was hitting a rough patch due to Brexit or IBM firing contractors, then think again, as demand was strong during May.

In fact, the 4 weeks leading up to June 2017 was the busiest time this year for IT contractors, as companies all around the UK needed certain skills that couldn’t be found elsewhere.

This is all according to a national staffing index, that shows demand for temporary IT skills was at 61.9 during the month of May, compared to 59.2 in April and 60.1 in March.

It seems to suggest that not only was May the busiest time for IT contractors so far this year, but it was also busier than any month last year. I for one, will be interested to see the stats for June, July and August of this year…could demand for IT skills get even stronger? Only time will tell.

You have to go back to April 2015 when the demand was stronger, when the score according to the national staffing index was 62.2.

So why are IT contractors so in demand right now, shouldn’t it all be doom and gloom with Brexit on the horizon and the slump in the economy? Actually, no.

Firstly, reports are suggesting that many IT contractors from the EU are leaving the UK and going back to their home countries. This has led to companies turning towards British IT contractors when they need work doing.

Secondly, IT security is becoming an issue for many companies and businesses around the country. It was only a few weeks ago that British Airways was hacked, and many others are now starting to experience similar issues.

This means that IT contractors who specialise in security are now finding their skills very much in demand, with some companies willing to pay top money if they can keep them safe from hackers.

Lastly, there appears to be a shortage of IT skills in many areas of the country, with things such as Data Analytics, Software, Cyber Security, and Java, being right at there at the top of that list.

If you are an IT contractor with those kind of skills then you should have no problem getting work, with a nice pay packet to go with it.

Will this last though, or will IT contractors find themselves out of work in the near future? Obviously no-one can say for sure, but if you ask me, I would say that the IT contracting scene is looking very good in the UK right now, and it is only going to get better.

So if you have the skills and are willing to do the work, you should be able to get paid some decent cash for IT contracting in 2017.

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IBM Tells Contractors “Take Pay Cut or Go”

It’s a harsh environment out there in the contracting world, and there is none as harsh as the IT industry, as proven by a recent IBM memo.

What the computer giant is basically saying to all their contractors is this…”take a pay cut or go elsewhere”

This comes at a time when IBM have decided to shift their model to a dedicated employee workforce, after using contractors almost exclusively for the vast majority of their projects for many years now.

Not only that, but some insider sources are claiming that IBM have banned the hiring of any new contractors, which means it is no longer in the market for a skilled and flexible workforce.

Those who are already contractor workers at IBM, well, they have been told that a pay cut is what will happen, and if they don’t like it then they can go elsewhere. It is thought the pay cut is somewhere in the region of 10%.

Do you know what though…in my opinion IBM are well in their rights to do this, because at the end of the day that is one of the benefits of hiring a contractor, the flexibility in that you can get rid of them at any time once your plans change.

No problem at all if you ask me, because it does work both ways. I’m sure that many contractors have just downed tools at IBM and gone to companies such as Microsoft or Google without even so much as a goodbye letter. Well, IBM can do the same thing.

That is not to say I think IBM are doing the right thing, because from what I’m hearing contractors around the world are not impressed with what is happening and that could lead to many workers giving them a miss in the future should IBM ever be in the market for temporary workers once again.

What seems to have happened is that contractors are not so much disappointed with the fact that IBM have told them to take a pay cut or clear off…I reckon it was the way in which it has been done, to the point where many workers appear to be a bit confused about the whole situation, with IBM being accused of not explaining fully what is happening.

I don’t think many of these IT contractors who have been working for IBM will have anything to be concerned about, because if there is one thing that is always in demand it’s IT skills.

Many companies around the world are willing to pay top money for skilled IT contractors, which leads me to think that almost all of these people should be able to get many jobs lined up once they have cleared their desk at IBM.

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Medium Sized Businesses Need More Contractors

Experts are advising medium sized business owners around the country to focus on hiring more contractors as part of a flexible employment strategy.

I agree completely with this one, especially when you consider the amount of talent that is available with the thousands of contractors offering their services right now, in a variety of different industries.

The message is simple: why go through all the hassle of hiring permanent staff, when you can easily hire a contractor who often has the same or more skills, but doesn’t have to be added to the payroll when the demand for their services isn’t required anymore by your business.

However, as studies have shown, many medium businesses who hire contractors for short term work end up keeping them around for months, and even years.

What I’ve been hearing is that many medium size business owners are really impressed with just how quick contractors are able to adapt to the job they are given, which in the past was a concern when hiring contractors.

The general thought process used to be…we are going to spend hours training someone who might not even be around in a few weeks. However, these days it’s much more a case of…just give them the work and leave them to it.

I think this highlights the importance of hiring specialised contractors so the amount of training is minimal, even if it means paying a bit more for their services.

For example, if you want an IT contractor for a specific project, then getting someone who is experienced in this area is essential. Anything else just ends up wasting your valuable time.

What are some other reasons why contractors are perfect for medium sized businesses? Well, for one, they are available to start right away when you get unexpected work or projects that needs to be completed quickly, and then once finished, there is no obligation to keep them around.

This also holds true for seasonal times such as Christmas where you might require extra staff for a couple of weeks to cope with more business and customers. Once the seasonal demand is over, the contractor no longer has to be kept on the payroll.

Another reason is that very often a contracting professional will bring fresh ideas into your business, which can give you more ways to profit. Just one idea can provide your business with an exciting breakthrough.

Ultimately, hiring contractors is all about building up a list of contacts that you can trust. Hire someone for a few weeks to finish a job and then drop them off your payroll, but they are always only a phone call or email away where you can contact them for another job.

At the end of the day it’s all about flexibility and what is the best overall strategy for your business.

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Christmas a Quiet Time for IT Contractors

Despite IT contractors being in huge demand this year, new reports are suggesting that Christmas will be a quiet time.

The report, which was published in November, shows that demand for IT type services typically drops significantly during the December period, only to then get back to normal at the beginning of January. This happened during both the end of 2014 and 2015, and is now predicted to follow this trend at the end of 2016.

I think this is something that happens in most industries, and I wouldn’t be too worried if you are an IT professional who is finding it difficult to find contracting jobs this Christmas.

In fact, you might want to sit back and relax for a few weeks, and then be raring to go in the new year, because many of the other reports I’ve been listening to are predicting that 2017 is going to be one of the best ever for IT contractors.

This is especially true in specialised areas of the IT industry, where certain skills are in high demand and they need contractors to fill positions. For example, cyber security, digital services, gaming, software, and technical sales are just some of the areas where your IT knowledge and expertise is going to be needed in 2017.

Also, when you consider that the UK might very well go forward with Brexit and leave the European Union, then some experts are claiming that it could mean even more shortages of skills in key areas. Who knows exactly what is going to happen, but what I do know is that for IT contractors there should be more work than ever before, both in London and other areas of the country.

There is a downside to the potential Brexit situation though. A few pundits have commented that many companies might be tempted to relocate abroad in a bid to get IT professionals if they can’t do it at a suitable cost here in the UK.

I’m not too sure if this is going to happen. We’ve already seen how many of the biggest companies in the world have committed their future to the UK, and how companies such as McDonald’s are basing their international headquarters in London. I wouldn’t be surprised if similar companies do exactly the same thing, which in turn would mean more opportunities than ever before for IT contractors.

For now, it’s probably time to enjoy the end of a successful 2016 and celebrate Christmas with family and friends, and then get ready for 2017, because as an IT contractor your skills are very much needed by the UK economy.

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DWP Let Hundreds of IT Contractors Go

When it comes to IT contractors there appears to be no shortage of work, but that isn’t the case at the Department for Work and Pensions.

It has just been announced that hundreds of IT contractors have been let go, while at the same time many of their digital and technology projects have been put on hold.

This is no doubt their way of saying “we have overspent our budget and can’t afford anything else this year.”

If this is the reason, then it makes you wonder why everything can’t be planned better, I mean, they are the Department for Work and Pensions after all, surely they should be hiring more contractors, not getting rid of them.

Also, let’s not forget this comes at a time when everything is supposed to be going digital, so it really does make you wonder what is going on here.

I wouldn’t feel too sorry for the IT contractors, because if there is one thing we know it’s that umbrella contractors in the IT industry are always in demand, which means they will have no problem getting work from other big companies in the UK.

There have been a few sources claiming that DWP have spent £250m on digital projects so far this year. However, this has been denied by an official spokesperson for DWP.

Instead, they are claiming that it’s simply the nature of contracting and what they look for in IT contractors specifically, with flexibility being top of the list.

You know what…I agree with DWP here. If there is one thing many people like about the contractor lifestyle it’s the flexibility and freedom that working these kind of jobs provide, so I don’t believe anyone should really be complaining.

It wouldn’t surprise me if many of the IT contractors who were let go, might be re-hired again at some point, either later this years or next year.

I just find it a bit strange the DWP suddenly decided to get rid of so many contractors at once…almost as if they suddenly realised their budget was all wrong or something like that.

If some reports are to be believed then it seems DWP have actually stopped ordering stock from many of their IT suppliers, while at the same time there are are thousands of Microsoft Surface Pro laptops still in the boxes stored away in cupboards at DWP offices around the country.

Who knows what the real story is here, as we are hearing different accounts of the situation, but in better news it seems that permanent jobs at DWP are still secure and it is business as usual there.

Let’s wait to find out what happens with this one. I’m sure IT contractors will be hired again at DWP once they get everything sorted out.

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Research Suggests IT Contractors are Confused

We all know that IT contractors are in huge demand right now around the UK, but it seems that many of them may actually be confused.

How so? Well, new research has uncovered that many of these IT professionals are confused about the contracts they have with many of the leading tech firms.

As we all know, these umbrella contractors work on a temporary basis, many with contracts that range anywhere from a few days to a couple of months, although sometimes it can lead to a more permanent arrangement

The research suggests that 70% are confused about their contracts, with the majority of those surveyed admitting that they need help better understanding the written agreements they currently have.

To put it in plain English, a lot of these tech firms like to hide things away in the terms and conditions, and very often, this doesn’t work in the favour of IT contractors. It’s not uncommon to see contracts ended early or pay to be withheld, all because there is small print hidden away in the written agreement.

Let’s face it, the vast majority of umbrella contractors are not lawyers and do not have a law degree. This means they are often at a disadvantage when negotiating with these big firms and it is far too easy for them to get a deal that doesn’t benefit them.

I’ve been saying for years that umbrella contractors need more free support when it comes to negotiating their contracts, and it should be the government offering this kind of service.

Not only that, but watchdogs need to look more closely at the behaviour of some of these tech firms and their big powerful legal teams, who are usually more than happy to put the contracts completely in their favour, even if it means the IT professionals lose out.

Luckily, it appears that things are being done to help out those most in need. One example is a 3 part guide that has just been commissioned, which has the goal of solving many of the problems that umbrella contractors have when negotiating deals.

This is definitely a step in the right direction, and it just goes to show there are resources available for IT contractors, and any type of contractor, that wants to get more knowledge when it comes to the negotiating table.

Now of course, I’m not saying that everything should be in the contractors favour and that technology firms should just let them call all of the shots. It’s just that if the playing field is a bit more level then everything will become more fairer, which in the end should result in more productivity, which in turn is better for the economy.

At the end of the day, in this post Brexit world we need to be supporting each other more than ever, so that our country can get the economy it deserves once again.

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IT Contractors Accept Lower Pay Rates

It seems that umbrella contractors working in the IT sector have decided to accept lower pay rates from Clydesdale Bank in a move that has left some experts shocked. It is estimated that these freelance temporary workers have agreed to a 10% reduction in the amount of money they are paid, although a few financial analysts have predicted it could be as much as 15%.

Unfortunately, this is a move that many people saw coming on the horizon, with a few pundits saying it is necessary in order for the freelancers to keep their jobs and hold on to valuable contracts. While not everybody is happy about the drop in pay, and let’s face it, who would be…there is an air of acceptance about the whole situation as they realise that daily rates with the bank are down as much as 15%, with some predictions putting it almost at 20%.

Clydesdale Bank are a major employer of umbrella contractors, and many of their brands are well known throughout the UK, including Yorkshire Bank which is popular among consumers, and has been for many years. However, when you consider the way in which this has been handled, with many freelancers refused contract extensions if they didn’t accept the new terms and pay rates, then it’s easy to see why their image may take a bit of a hit over the coming months.

It is always difficult when you expect people to do the same work for less money, and this leaves some of the IT professionals considering their options about what they might want to do in the future. Perhaps a career change might be on the cards for a percentage of those workers affected? At the end of the day who could blame them, especially if they can find higher pay elsewhere in a different industry.

Ultimately though, it seems that many of the umbrella contractors are happy to move forward and continue offering their services to Clydesdale Bank. In particular, one contractor who wished to remain nameless commented that while the lower rates were not ideal, the rates are still pretty decent…which just goes to show that even when a company offers contractors less pay, there are many who stick around and continue to offer their services.

IT experts have warned the bank about the quality of freelance professionals it will be able to attract in the future though, especially if they decide to drop the pay rates even further. This particular field is very competitive, and there are sure to be other companies out there hoping to lure the most qualified contractors with offers of higher pay and more bonuses. This could lead to Clydesdale Bank and other banks who follow the same path into a situation where the quality of work is not as high, which in the end leads to a reduction in the service they offer to customers.

Only time will tell if this affects the bank and its profits in the future. One thing I do know though, is that if they drop the pay rates any further then umbrella IT contractors should definitely start looking elsewhere.

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IT contractor demand strong, research reveals

The demand for IT contractors, freelancers, agency workers and other self-employed experts in the UK is going strong and is likely to stay that way.

At least, that’s what the experts say. IT resource specialists Experis just announced that Britain, when held up to other regions internationally, was one of the best places to find work as an IT contractor last year and that specialised IT workers looking for temporary work are going to be in high demand for 2016 as well.

How well are we talking about here? Well, Experis discovered in their research study that 76 per cent of firms in the UK make use of freelancers or umbrella company contractors for their information technology needs. Yes, you read that correctly – more than three out of every four British firms. This is far and above the international average, Experis reports. Not only that, but last year saw a 10 per cent jump in the number of IT contractor positions on offer in the UK from January to December.

So what’s driving this fantastic demand? Experis is rather convinced that the skills gap is largely working in favour of IT contractors, as the number of firms that need IT specialists keeps growing while the number of available individuals looking for work in the sector remains stagnant. In lieu of letting their own firms falter, these businesses hire on temporary contract workers instead – not only does this result in these companies being able to continue to grow themselves, the amount of money these firms can save by employing an umbrella contractor or freelancer is highly attractive.

So how far ahead of the curve is the UK? The figures are just astonishing if you ask me. The closes to the UK was the United States with 66 per cent. Meanwhile other major regions like Japan and Jermany could barely muster 65 per cent and 40 per cent respectively, though Experis says the firms they surveyed in these countries indicated they’ll be ramping up their hiring this coming year – or at least they want to quite badly.

In other words, well done you if you’re an IT contractor. You’re likely to have an absolutely brilliant year unless something absolutely catastrophic occurs. Maybe a solar flare will hit the Earth and knock out our power grid or something, plunging us into a second Stone Age. Of course that’s a big maybe, so we’re probably not going to suffer such a fantastic and tragic fate.

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2015’s third quarter a good one for IT contractors

Researchers say that IT contractors, either working as freelancers or for an umbrella company, had a fantastic third quarter of 2015.

According to Experis, a specialist staffing agency, their research found an increase of six per cent in open positions from July through September of this year. Experis says there were more than 5,800 contract positions added for IT specialists; the staffing firm analysed some 52,000 positions over the course of its study.

This is of course fantastic news for IT contractors looking for new projects to work in the UK. In fact, it’s a bit of an anomaly, with most summers showing a marked slowdown during this time. In fact, permanent positions dropped over the third quarter, with the biggest drops in cities like Edinburgh, Glasgow, Manchester, Cambridge, Birmingham and London – all locales that are well known for  being an excellent source of employment for IT professionals.

Once again it looks like temporary workers in the IT industry are sitting pretty in comparison to their permanent counterparts. In fact, Experis found that salaries, on average, declined by one per cent for permanent IT workers while contractor day rates went up to £410, a massive jump of four per cent!

So in other words, it’s a great time to be a freelancer or an umbrella company contractor if you’re working in the IT industry. As for what’s making the IT sector decide to position itself as a hotspot for temporary workers, well for what it’s worth I think it’s a bit of a “perfect storm” situation, as you have all these new and emergent technological specialities like cloud computing or big data, and firms that want to remain competitive have to attract the absolute best of the best. You can’t do that by paying IT workers rubbish, so pay rates go up in order to entice these luminaries.

Meanwhile, why the push towards temp workers instead of permanent ones? The short answer is the skills shortage is still wreaking havoc with the employment sector, and nowhere is it most apparent than in the IT industry where there’s a massive need for workers with enhanced education and experience but only a handful of workers with the requisite skills. The majority of these blokes and birds are working as freelancers, making it extremely difficult to source permanent workers, so employers are reducing the resources they’re spending on traditional employees and instead funneling those resources into temporary IT workers.

Will this trend last? For a little while, at least. Will the IT freelancer population support the increased demand? Well, I suppose we’re about to find out, aren’t we? Better strap yourselves in – we’re all going to be in for a bit of a bumpy ride!

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Next gen IT Contractors to come direct from full time edu

Interesting to read yesterday’s article on Freelance Supermarket, which prophecies that apprenticeships may threaten the future of outsourcing for specialist requirements. Today, we learn that the government is taking yet further action to engender much needed skills into young hopefuls immediately after their full time education.

We’ve spoken at length about the growing skills gap facing many industry sectors here in the UK. IT is the obvious skill businesses lack to take them forward. Those who’ve followed and studied the development in information systems are now reaping the rewards.

The pickings may be rich for IT contractors now. But the introduction of tech levels may see IT (to the level businesses can use) instilled as a core subject in post-secondary school education.

Learning IT should be as easy as A-B-C

ReThink Recruitment certainly see the possibilities of offering tech-levels as a viable alternative in further education for 16-19 year olds. And it’s not difficult to see why.

Prior to the open-source nature of the Android platform, IT studies were the provenance of the geek. It’s not so nowadays. Learning to code, build apps, use other people’s platforms as a basis for your own – learning to do so is all available online, often for free.

It’s perhaps this reason that firms like Microsoft and Siemens are backing the UK curriculum’s introduction of tech levels.

Google (or now, Alphabet) has stolen a march on its competition. From data-parsing, organisation and understanding of that data (see: Knowledge Graph) and even AI, the Mountain View, California company is a magnet for the best of the best.

With more input from the business community, tech-levels could be a real opportunity for UK firms to compete on a global basis.

Protecting more than your IP address

There is, of course, a downside for contractors. The more their specialist subject becomes more commonplace, the more competitive the marketplace will become. It’s important that those promoting IT-for-all understand the value that its students will add to the economy.

Too many freelance and contract skills haven’t had this protection. Writing, for instance, has become a globally-sourced commodity. Anyone with a basic grasp of English can offer their services as a writer. Social media marketing is heading the same way.

But it’s important to understand that not all content is equal. The same as not all IT professionals will be as proficient as those who’ve studied its nuances over time.

It’s great that the curriculum is looking to fill the skills gap. But with the promotion of apprenticeships too, one has to wonder: at what price?.

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HMRC taking no prisoners in the war against IR35

The Telegraph this week reports that as many as 600,000 people are cutting their tax bill by opting for a Limited Company payment structure. The majority are contractors who, by taking specialist advice or going through an Umbrella, do it the right way.

But there are many who are not contractors. They’ve set up shop as a Limited entity purely for the tax-breaks on offer. It’s the latter who could well be staring an IR35 barrel in the face.

How many contractors are at risk in the UK?

According to the ONS, the official figure is 300,000 one-(wo)man-bands operating this way. But many who go limited also designate their spouse as an employee.

The appointment of a non-working better half allows first for additional household tax saving. But this tactic also explains why over 500,000 self-employed workers choose this payment structure.

Why is this a problem?

IR35, or intermediaries legislation, was introduced on the 6th April, 2000. Its purpose was to weed out disguised employees, back then handled by third party management companies.

The problem arises when the job the self-employed person undertakes can in no way be differentiated from that of an employee. It has to be this way as there remains no clear definition of the difference between employment and self-employment.

The IR35 team will try to build up a picture of your working relationship with the client. If you go through an Umbrella company and agency, there is an assured distance. But if you have a pre-existing relationship, that’s when the waters get muddy.

What are the consequences of being found inside IR35?

Let’s clear something up, first. HMRC has stated that there’s no such thing as an IR35-proof contract. But we can ensure that we, as contractors, look like a company trading in our own right.

Amongst many things, we can pay for our own stationery, actively network and market our business and hire an accountant. Demonstrating that we pay ourselves in a fashion that befits a business, not an individual, is often overlooked. It shouldn’t be!

We also need to understand how hot HMRC is on IR35 cases. Earlier this year, the taxman fined two entire government departments. Yep, even their own.

And that set a precedent. Soon after, 100 civil servants who were being paid off the books, including some holding lofty positions in the National Health Service, got the boot, too.

For many contractors who get caught inside IR35, the consequences are dire. Almost all avenues of tax-saving are closed down. Their pay defaults back to PAYE. And because they have to pay both Employee’s and Employer’s NICs, they can actually be worse off!

It’s well worth checking out the Telegraph article. They have two examples of operating through a Limited Company incorrectly (inside IR35). And one that ticks all the right boxes – that’s the one you should really pay attention to.

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