Reply to: State of the Market

[willendure]

Even assuming that things are going sideways, you'd think that some projects would emerge at some stage. Otherwise how the hell are companies making money? there's only so many people you can sack to fake profits.

There are a lot of zombie companies right now, and a still approaching wall of zombie refinance. This means companies that borrowed cheaply in 2020 when interest rates were low, but are debt reliant and not profitable, will see 5 year loans mature in 2025 that they must refinance-or-die. If interest rates are put back low, its because of an emergency, it does not necessarily mean money will be available to all at good rates, since loan conditions will also be tighter. For example, in 2009, rates were very low but banks were not lending.

https://fortune.com/2024/06/07/zombi...ar-debt-loans/

[dsc]

I don't watch those, or buy into that narrative. I am saying there is going to be a deflationary event, not economic collapse. If there was a control board for the world economy, it would be flashing up all red warning signs at the moment - sure it might not happen, but the warning lights ARE all on. I actually hope you are right and we get blue skies and I am proved wrong. There is probably a melt-up in financial markets coming that I will miss out on as a result of my cautionary stance, but I am ok with that.

Even assuming that things are going sideways, you'd think that some projects would emerge at some stage. Otherwise how the hell are companies making money? there's only so many people you can sack to fake profits.

[willendure]

Lol, you need lay off the 'economic collapse imminent videos' on youtube.

I don't watch those, or buy into that narrative. I am saying there is going to be a deflationary event, not economic collapse. If there was a control board for the world economy, it would be flashing up all red warning signs at the moment - sure it might not happen, but the warning lights ARE all on. I actually hope you are right and we get blue skies and I am proved wrong. There is probably a melt-up in financial markets coming that I will miss out on as a result of my cautionary stance, but I am ok with that.

[avonleigh]

Lol, you need lay off the 'economic collapse imminent videos' on youtube.

The market is improving markedly already, the jobserve headline number jumped from 15K to 36K, after just one minor rate cut by the BOE last month.

Is the market really improving? I am not seeing any evidence of it. There are a lot of permanent roles in Europe that are popping up, a lot seem to be duplicates. So maybe this is distorting the figures.

[Fraidycat]

Lol. Next DotCom/GFC is just about to get started...

Lol, you need lay off the 'economic collapse imminent videos' on youtube.

The market is improving markedly already, the jobserve headline number jumped from 15K to 36K, after just one minor rate cut by the BOE last month.

[willendure]

We are nearly at the end of this i think. The dot com crash took down the UK contractor market for about 30months. (Mid 2001 to end of 2003)
We are 26 months into this one, and interest rates cuts are on the way down and in 4 months the next US president will take office. Coinciding with the 30 month mark.
Blue skies ahead.
I would at least continue applying for roles where you are a perfect match based on the spec and your skills.

Lol. Next DotCom/GFC is just about to get started...

[sreed]

I think contractors current challenges are only a symptom of a wider problem. I know it is unscientific but looking on LinkedIn I am not sure the permanent market is much better and IT recruitment is a blood bath at the moment.

Exactly this. The fortunes of the 'contractor market' (however one might define the wide spectrum of ways in which companies hire temporary talent) will largely follow the general job market within a sector/industry.

And as others have mentioned, no one gives a tulipe about the specific travails of the contractor job market, not the general public and not the government (any government). In the grand scheme of things, we're a small part of the job market, that's it.

As far as the pure IT sector is concerned, an interest-rate cut or an uptick in the UK economy will not necessarily translate into good times for jobs/contracts in the sector. There's a massive amount of excess supply built up over the past few years, they're not going anywhere yet.

[Fraidycat]

Well, think I have decided not to bother looking for the time being. It's just bringing down the enthusiasm I once had for software development.

Things are not improving and after 12mths of applying and getting nothing. Probably time to look at other things.

We are nearly at the end of this i think. The dot com crash took down the UK contractor market for about 30months. (Mid 2001 to end of 2003)

We are 26 months into this one, and interest rates cuts are on the way down and in 4 months the next US president will take office. Coinciding with the 30 month mark.

Blue skies ahead.

I would at least continue applying for roles where you are a perfect match based on the spec and your skills.

[SchumiStars]

Well, think I have decided not to bother looking for the time being. It's just bringing down the enthusiasm I once had for software development.

Things are not improving and after 12mths of applying and getting nothing. Probably time to look at other things.

[dsc]

I think contractors current challenges are only a symptom of a wider problem. I know it is unscientific but looking on LinkedIn I am not sure the permanent market is much better and IT recruitment is a blood bath at the moment.

If that's the case, then contractors who think some gov will just swoop in and fix all their issues are even more delusional. We are really at the very far end of the queue of things to fix and overall are pretty well ahead of permies in terms of taxes / pay etc. That gap is getting smaller each year, which is only a win for HMRC.

[hungry_hog]

If anyone here is in FS, Citi is hiring extensively. I get about 2 emails a week from agents for them. Even when it's not mentioned you can tell from the terminology who it is.

They are always hiring, make of that what you will

[willendure]

This is why it always makes me laugh when people here say that the gov needs to fix this or that for us to make more money / get jobs etc. As if we are the priority

Exactly - as a contractor I never complain because I know I had a good deal. I remember once working for a government department, and they screwed up their budget, so at xmas time they told all the contractors unexpectedly to take a full 3 weeks off. This happened on the day before we were winding up for xmas, no notice or anything. And they all whined about it apart from me. I was thinking, great 3 weeks off for me to do all the tulip I need to do, and I've got a job to come back to in January, so bonus!

What I wanted to say is, there is a problem in the UK and it extends to most western countries. That is that the boomers are retiring, shrinking the productivity of the economy, and going from high earners to tight fisted pensioners overnight; that significantly changes how they view their capital. You can see how this played out in Japan already and from that derive a picture of how this will be and is affecting the UK. In many ways it didn't really matter which party we elected at the last election because they all face this issue. Since demographics is "baked in" and cannot be changed, there are no easy solutions. A major difference with Japan is that they don't have immigration like we do. Hence they have found remaining politically unified easier as a population with a more singular ethnicity. The difficulty the UK has is that immigration is a possible solution to demographics through filling in desirable age ranges by recruiting from abroad, but that also increases political division.

So tough choices indeed, and contractors are not a priority. But also we've been hit in the past by tax changes, how much is left to squeeze out of us, or are their more ambitious targets that mean we get overlooked?

Rumours of 45% on all dividends sound a little paranoid.

[SussexSeagull]

This is why it always makes me laugh when people here say that the gov needs to fix this or that for us to make more money / get jobs etc. As if we are the priority

I think contractors current challenges are only a symptom of a wider problem. I know it is unscientific but looking on LinkedIn I am not sure the permanent market is much better and IT recruitment is a blood bath at the moment.

[dsc]

[...]but high-earning contractors will be squarely caught up in it and, honestly, it will be very hard, perhaps impossible, for them to not screw it up.

This is why it always makes me laugh when people here say that the gov needs to fix this or that for us to make more money / get jobs etc. As if we are the priority

[SussexSeagull]

Was talking to my friend, a small business owner. He was saying that prior to COVID he struggled to find staff but now he has people literally knocking on his door asking for work.

Also told me that the freshies have to also pay some sort of 10-year-visa-plan, which is around £2k per year.

No wonder the govmt love immigration. It literally is cash cow for not offering much more than what is here. Supported by the current infrastructure.

Not so good when you have to start paying people benefits because they can't find work.