Has anyone pin pointed why the contract has gone tits up - been a while

[SussexSeagull]

Why has the contract market declined in the last few years? In the main it is the economy but, and I say this as a card carrying member of the Labour Party who thinks that the country does need managed immigration, I just has a contract cut short where the team was managed by an Indian and more than half the team were Indian. It's not their fault because they are legitimately in this country but a few years back the industry decided there were labour shortages when in fact there was just a shortage of cheap labour. The talent pool has been diluted and now there isn't enough to go round.

[Fraidycat]

7 months out for covid and pension disappears

Seven months worth of savings was not your pension it was your 'war chest'

Based on your posts your house was your retirement plan/pension.

You will need to find some other way to extract equity from your house if you cant sell it for a good price in this market, that money will then be your new war chest.

How are you finding the housing market?

[JustKeepSwimming]

Why has the contract market declined in the last few years? In the main it is the economy but, and I say this as a card carrying member of the Labour Party who thinks that the country does need managed immigration, I just has a contract cut short where the team was managed by an Indian and more than half the team were Indian. It's not their fault because they are legitimately in this country but a few years back the industry decided there were labour shortages when in fact there was just a shortage of cheap labour. The talent pool has been diluted and now there isn't enough to go round.

India has a 45% graduate unemployment rate, which is why India was so eager to get visas as part of a trade deal. So the situation is going to get worse as Western countries are enticed by cheaper labour. You're right there was never really a skill shortage outside of some very specific industries, like healthcare, but even that was largely because we artificially limited the number of nursing/doctor placements at university. We only train 8,500 doctors and 30,000 nurses a year, we have a shortage of about about 125,000, and that's whilst importing everyone with a pulse. Despite the poor pay and conditions we still have 30,000 chasing those 8,500 doctor places and about 50,000 to be a nurse.

70% of employees in the UK don't believe they are progressing in their career and or there is an opportunity to progress. That's largely the result of importing skilled labour rather than investing and promoting junior employees.

How are you finding the housing market?

I'm watching housing market closely, it's absolutely dire. The market and it's participates still aren't ready to accept higher interest rates and unless you price very aggressively you aren't going to sell.

[SussexSeagull]

India has a 45% graduate unemployment rate, which is why India was so eager to get visas as part of a trade deal. So the situation is going to get worse as Western countries are enticed by cheaper labour. You're right there was never really a skill shortage outside of some very specific industries, like healthcare, but even that was largely because we artificially limited the number of nursing/doctor placements at university. We only train 8,500 doctors and 30,000 nurses a year, we have a shortage of about about 125,000, and that's whilst importing everyone with a pulse. Despite the poor pay and conditions we still have 30,000 chasing those 8,500 doctor places and about 50,000 to be a nurse.

70% of employees in the UK don't believe they are progressing in their career and or there is an opportunity to progress. That's largely the result of importing skilled labour rather than investing and promoting junior employees.

I was referring to the IT industry but I am sure it is the same in other sectors. Problem is immigration gets labelled as some sort of left wing pet project but in reality (legal) immigration is generally in the interest of business and industry, hence since Brexit net immigration has increased.

[Snooky]

Been out for nearly 6 months now. House up for sale, credit cards maxxed out. Pension was eaten up by covid. I'm 63 and about to become homeless. Wtf has happened.
Been contracting as a tester for over 20 years and never been out for more than a month. Used all the funds in the company account so owe VAT and soon to be Corp Tax.
Bankruptcy an option? Don't know how it works. Christmas looms...Have lots of life insurance - seems the best option for the kids. I've had enough of agents and umbrella companies and ******* IR35. Well done the government, you have finally broken the freelance contractor!

Have you considered a permie or part-time role? Are you not able to get any kind of paid work, even if it's a fraction of what you were used to, to keep bills paid, e.g. shelf stacking at Tesco? I know that when I couldn't find a scrap of work after 9/11 (I work in Financial Services usually) I scrabbled around for weeks and took whatever I could which paid something, anything, while the whole family tightened their belts in case it was a long haul; luckily we didn't end up in as dire a situation as you describe, but it could have been. In that position we can't be fussy about it having to be contract work, or needing a particular rate, or even being the kind of work we're skilled at, we need to just grab whatever we can get. Perhaps you've already tried all that without success - either way, I really feel for you in such a worrying and distressing position.

[cojak]

I'm sorry to hear this Wobblyheed. While reading your post I was reminded of a thread back in 2006 (!) that tackled this exact problem.

I'm resurrecting it as there may be ideas in there that could point a way out.

Serious Question - Contractor UK Bulletin Board

[rocktronAMP]

To be fair that's what absolutely everyone is thinking and there are some threads to bring it up. I think most didn't think this was one of them.

Sadly, it has alway been like that. Contracting is feast and famine. You got £600 per day worked for 9 months, then 3 months on the bench. In reality, you earned 75% of your potential. It is easy trap to fall into.


Business Debtline / Christians for Poverty in Family are placing to go to now for advice.


Nobody could see the pandemic coming, the austerity of the economy since 2010, the sudden cost of living crisis (post pandemic) and of course the effect of Off Payroll Worker rules (blanketing my business public sector 2017 and pivate sector 2020/ 2021). The latter has devastated contracting, for the evidence just look at the number pages 932 of this damn State of the Market.

I worked with my many great testers from Digital Mobile UX through the operational cloud testers and way back in the day regression folk inside investment banks, who loved their Excel spreadies. So I feel for you. Just got sort your head out and speak your family, if you haven't already. J.F.C I hate this 2023!

[rocktronAMP]

If you have a lot of equity in your house then I don't think you're in as dire straits as you think. You certainly aren't bankrupt.

Your company debts are still your companies. I've seen no evidence that companies that genuinely went to tulip because of covid are having their corporate veil pierced.

Unsecured debts like credit cards rarely ever get to point as touching your house, provided you don't bury your head in the sand. I don't know your circumstances, and some might not like it, but if someone tells me they are struggling with unsecured debt I would always advise putting in an affordability complaint.

The trouble with unsecure credit cards and big debt is the poor credit ratings. If you suddenly added to it with a PCP car, Wren or B&Q kitchens and bathrooms, or some tulip extension like a new conservatory or new garage, then it is easier to see the OP concerns. You think that the revenue stream of income will continue for 4 years and then it will be paid off. Like the best laid plans, But the Mother of Leftfields comes in, unfortunately there have been too many left field events in the recent times. Once upon a time, you could readily get Credit Cards wirth Balance Transfer 0% interest rates from provider, the longest I saw was Sainsbury 40 months at 0%, the trouble is that with bad credit rating your selection is 2,1 or even 0 providers. The providers now have shrunk their best 0% BT lengths to about 12 months to 21 months. If you have brilliant credit rating, then you could get 28 months from M&S. Of course this is tulip advice and it won't help the OP. Selling up is riskier now, because you have to really think in this economy who can buy your house, who can afford the asking price, so you should expect a sizeable drop in the estate agent's evaluation. Finally, where do you live in the UK that is cheap and has a growing economy. Hemsby / Scatsby by Sea?!!

Well Liz Truss almost did kill off the Off Payroll Rules, 2022, and that was so closest contracting became viable again. We know what happened to her budget plans. Personally, I doubt the economy and the contractor market will ever get back to the nice contract rates of 2018/2019 for the rest of this decade. That ship has now sailed off to Avalon. State of the Market thread, will be at 1932 pages, in 2030!

[oliverson]

Been out for nearly 6 months now. House up for sale, credit cards maxxed out. Pension was eaten up by covid. I'm 63 and about to become homeless. Wtf has happened.
Been contracting as a tester for over 20 years and never been out for more than a month. Used all the funds in the company account so owe VAT and soon to be Corp Tax.
Bankruptcy an option? Don't know how it works. Christmas looms...Have lots of life insurance - seems the best option for the kids. I've had enough of agents and umbrella companies and ******* IR35. Well done the government, you have finally broken the freelance contractor!

Been there a few times.

1. Dotcom crash - made redundant from my last permie role and out for 12 months - forced me to set up my Ltd company
2. Financial crash - several spells on the bench was enough to see everything come crashing down. I'd overcommitted (car leases, flash houses, holiday homes, etc), thinking things could only ever get better. Booted out of the leased home, both cars repo'd, ruined credit file, less than 48 hours from the Spanish bank taking proceedings to repo the holiday home, loads of tax owed to HMRC. This was a VERY traumatic period of my life so I know what you're going through.
3. Fake-pandemic, IR35-looming and Brexit - I was prepared for this one, having learned lessons from 2. above. Back in the family home in the North, no South-East rental, no car leases, living within our means. Credit file had been repaired, or more specifically, the defaults no longer showed so we were able to borrow our way through it, all SEVENTEEN MONTHS of it. Sure the Ltd is repaying its BBL and we've accumulated some personal debts along the road, but dare I say it, times have never been better, business-wise. However, if/when current gig ends, I think that will be it for me as a contract dev in his upper 50's.

You mentioned having recently moved to a bigger house. Can you not 'move back' to a smaller one? If you can't sell, consider letting out as there's big demand for larger properties. Temporarily let yourself a smaller one.

The market will improve over time, even this one, you have to believe that, and as contractors,
when we are back in contract, the money soon starts pouring in.

Good luck.

[JustKeepSwimming]

The trouble with unsecure credit cards and big debt is the poor credit ratings. If you suddenly added to it with a PCP car, Wren or B&Q kitchens and bathrooms, or some tulip extension like a new conservatory or new garage, then it is easier to see the OP concerns. You think that the revenue stream of income will continue for 4 years and then it will be paid off. Like the best laid plans, But the Mother of Leftfields comes in, unfortunately there have been too many left field events in the recent times. Once upon a time, you could readily get Credit Cards wirth Balance Transfer 0% interest rates from provider, the longest I saw was Sainsbury 40 months at 0%, the trouble is that with bad credit rating your selection is 2,1 or even 0 providers. The providers now have shrunk their best 0% BT lengths to about 12 months to 21 months. If you have brilliant credit rating, then you could get 28 months from M&S. Of course this is tulip advice and it won't help the OP. Selling up is riskier now, because you have to really think in this economy who can buy your house, who can afford the asking price, so you should expect a sizeable drop in the estate agent's evaluation. Finally, where do you live in the UK that is cheap and has a growing economy. Hemsby / Scatsby by Sea?!!

I'm not sure I follow. None of that will have impact on what OP course of action should be if they are unable to meet their debt liabilities. It doesn't really matter what the unsecured debt is, (PCP is secured debt BTW). OP currently isn't in a position to refinance his unsecured debt (be it because of rates or lack of income), so if they can't make the repayments they need to raise the flag and engage with the lenders. It's very likely that their 'credit rating' will be impacted, but you don't spend time thinking about what colour to paint the kitchen when your house is on fire.