State of the Market

[SpliterOfLogs]

Or is it still early days and contracting is just one of the canaries in the mine?

I think it's more likely that the hard times many people have been putting up with for the last 10-15 years have now reached us contractors as well.

As far as contracting in software engineering goes I think it's a combination of factors:

1. Every year there are more people entering the market, more people graduating with IT skills
2. IR35 reform put companies off hiring contractors
3. Before the pandemic remote contracts were pretty rare, companies wanted their contractors in the office, now remote working has become normalised companies are happy to hire remote contractors from cheaper parts of the world.
4. Since brexit there's been a big increase in the number of visas for Indian IT workers, who are working at lower rates.

I've been contracting since 2004 and I can't really see things returning to how they used to be.

[SussexSeagull]

I think it's more likely that the hard times many people have been putting up with for the last 10-15 years have now reached us contractors as well.

As far as contracting in software engineering goes I think it's a combination of factors:

1. Every year there are more people entering the market, more people graduating with IT skills
2. IR35 reform put companies off hiring contractors
3. Before the pandemic remote contracts were pretty rare, companies wanted their contractors in the office, now remote working has become normalised companies are happy to hire remote contractors from cheaper parts of the world.
4. Since brexit there's been a big increase in the number of visas for Indian IT workers, who are working at lower rates.

I've been contracting since 2004 and I can't really see things returning to how they used to be.

I think this about sums it up, although Visas for Indian IT workers were being given out pre-Brexit.

Would be interested to see if anyone has studied this but my feeling is the bigger companies are abandoning, or at least heavily reducing, there use of contractors but there might still be a market in small to medium outfits who can't leverage the scales needed to properly outsource.

Looking on LinkedIn I am not convinced the permanent market is much better though.

If there is no bounce when the schools get back then things will begin to look increasingly existential for people who have been out of contract for a while, me included.

[Sub]

Question for you all. If we are right now in a recession or depression (whatever that means), why is it not mainstream news? 90s recession, dot-com, gfc, covid recessions were all big news stories.

Is it because central banks and governments are massaging figures and lying too avoid spreading a panic and still talking up the soft-landing narrative?

Or is it still early days and contracting is just one of the canaries in the mine?

I don't think that central banks and governments (and no one else for that matter) are really know what to do and just look and hope that crisis will just weather out somehow. We have gigantic bubble of corporate debt which is about to pop, so no company can be trusted to put money in.

Look at Thames Water as an example. It is likely already bankrupt, the only reason it is not unfolded yet, is probably because govt looking for way to make it softer for investors, so it does not cause chain reaction of realized losses. Will that be as "successful" as rescue of Credit Suisse and First Republic bank? So there is loads of fear on the markets, which cause hesitation in investment, hence slowing jobs market. Especially in areas on "bleeding edge". Everyone waiting for music to stop and holding to their nearest chair.

Or, may be I am just too pessimistic and everything will be OK, BoE just lowered their rate, why wouldn't that help?

[willendure]

I think this about sums it up, although Visas for Indian IT workers were being given out pre-Brexit.

Not like they have been in the last 2 years in particular. There was a big increase in the number of visas more recently. People have been hood-winked into thinking small boats is the problem, whilst far more people that actually have the education and skills to "steal our jobs" have been let in the front door.

[willendure]

I suppose what I am getting at is, is the downturn in contracting a cyclical or secular trend? Cyclical, I'm not worried its just the business cycle and things will pick up down the line. A secular shift that means contracting is permanently being broken I am worried about, because this is the only way I have ever known how to make a living - I had a 3 month stint in a permie job in 2000, and then became a contractor and have been one ever since.

[Smartie]

Has to be. The column is confusingly title "Historical Absolute and Relative", whatever that means.

There are some absolute figures too. For example for Project Manager, it has 2129 (historical absolute?) and then 449 live. So that means right now there are 21% (449 as a % of 2129) of the historical avarage for open roles? Or down by 80% as FraidyCat states.

The percentages are that role as a proportion of all contract roles.
Click on the role name itself to get historic numbers. BA roles are at about 30% of what they were for the same period two years ago.

[quackhandle]

I get updates on the contracting market from a recruiting pimp, make of it what you will.





Seems to tally with what I see on jobserve/linkedIn, etc.

qh

[Sub]

Seems to tally with what I see on jobserve/linkedIn, etc.

Makes a lot of sense too for current slow times. Many of the contracts were simply moved from being Outside to Umbrella contracts without rate uplift. At better times such approach would probably backfire, but in the environment with plenty of candidates around it works.
When tide will turn and employers will need to compete for labor, Outside IR35 determination will be one of the major selling points, so we likely to see the change. Plus some of the currently "Inside" & Umbrella roles will become permanent roles, as permie perks will be selling point too. But again, only when demand for labor is back.

However, I would not expect "outside" market to be as large as it was before 2017 as many gigs in finance sector (and public sector too) never been "outside" and with liability shift, they likely gone for good. For niche and rare skills employers will make effort to make gigs more attractive, for something more common there will be perm and Umbrella offers only.

[FIERCE TANK BATTLE]

New contractor devs recruited to my team, some have been fired and replaced for underperformance, some politics involved.

All are indian/pakistani. I remain the only British person on my team at my UK Government role (14 people on my team). In the wider project I think there are well over 100 people, I only know of two other British developers.

All roles are within the UK, nobody is allowed to work from overseas although it is remote.

I would accept the low rate theory but they're all contractors and the role was advertised at the same rate as everyone else.

If this is representative of the market as a whole then they're not outsourcing to India/Pakistan, people from India/Pakistan are moving to the UK and then are applying for contractor jobs here and being granted them.

The recruitment agency is all Indian staff.

If I wasn't there I expect they'd hold the standup in hindi. I've joined meetings before and heard them talking it.

What does this mean about the future of development roles within the UK?

[SussexSeagull]

I suppose what I am getting at is, is the downturn in contracting a cyclical or secular trend? Cyclical, I'm not worried it's just the business cycle and things will pick up down the line. A secular shift that means contracting is permanently being broken I am worried about, because this is the only way I have ever known how to make a living - I had a 3 month stint in a permie job in 2000, and then became a contractor and have been one ever since.

The million dollar question. We are in August so there is a short term trend in effect but previously when I have been out of work people were on here saying how they walked into a new contract usually with a rate rise. Conversely when I have been in contract others have been out. No one seems to be boasting about anything anymore, even those with fabled niche skills.