Reply to: Market really this bad?

[The Agents View]

Thanks for your input guys - I'm glad to see I'm not completely off the radar in terms of my thoughts. I think the issue alot of the experienced/senior/good people have is making themselves stand out. Whilst there are hundreds of keyword agents out there, I actually think this is often driven by the swathes of contractors who spam us on a daily basis as well. As I look at my inbox I have 7 direct approaches from consultants looking for work, 5 of them have never worked in my industry sector, and I happen to know that one of them is someone I would never represent, regardless of how good he/she claims to be.

It's also amazing how people with a years experience keep coming to me to tell me that they want to "get in" to my market sector on a contract basis. The response of "I specialise in contract/interim resources who have already delivered in my sector" often goes down like a sack of spuds, but you don't take a more expensive contract resource, train them and make them good at what you want doing - you take a permie for that, and invest in your team.

I often liken it to Ikea flat packs - the first time you manage an item, it takes 3 hours, 12 cups of coffee, cuts, bruises, and a kicked cat - the second time you do the same thing it goes together in seconds, and looks perfect - that is what contracting is about - doing something you already know how to do - not making it up as you go along!! There are obviously major exceptions to this, but they're transferrable skills (eg, stepping from say the haulage industry, into the mail industry - same theory, different sized boxes).

If I tell you that a colleague of mine placed a very in-depth role advert, with specific requirements (not discouraging those with the majority of what we're looking for from applying, but making it clear that there is a specific skill set required) and ended up with 147 applications within 3 hours, as well as countless telephone calls from candidates with no relevant skills at all, you can understand why some people go down the keyword route. I'd not do that myself, but in an industry where results are king, I can see the point of view of those who do - the only problem is they charge stupidly low margins, which cuts those of us who know what we're doing out of the equation because we get tarred with their brush until we've had chance to prove ourselves - which makes generating new opportunities, even for my existing relationships, tough to find.

TAV

[swamp]

Take the developer situation for example - it's not a rare skill, it's just everyone that is a developer jumps on the contract bandwagon - permies go down because everyone "wants" contract, and we end up with a skills shortage - driving clients to take contractors.

Senior developers are fairly thin on the ground. For Agile projects you need good, senior developers (and DBAs, config management ppl etc.) Even in a recession you may struggle to rapidly assemble a skilled team of permies.

Many projects are limited in scope so clients often only hire a few permies. Yes some companies can and do hire permies as contractors then fire them, but this isn't an option for many places.

Many projects are in public sector or in other organisations that don't have or want a permanent IT development capability.

[expat]

Just to go back to one of the earlier posts. Why do you guys include meals in your calculations?? Surely you'd be eating at home?

I agree with most of what you're saying, in particular about good quality people. I consider myself one in my field, and well suited to contracting; and indeed the more everybody and his brother pile into contracting, the harder it is to stand out. Especially, I have to say, since most agents just do keywords. I have certainly discovered in previous recessions that it is not worth giving up one's special skills and just hunting for e.g. bog-standard SQL coding jobs: not only are thay paying even fewer peanuts, there are hundreds chasing them and no way to distinguish yourself.

As for expenses, when I am in a hotel, I eat out; if I were at home, I would not. That's why I include these costs (restaurant dinners only). If I actually pay it because I'm away from home, and wouldn't if I weren't, then it is a real cost; and not including it would simply lead to a failed budget.

Much bigger costs are flights, hotels, and indeed getting to and from the airport especially at the UK end Return rail to London £48, across London, then Heathrow Express return £32. That's more on getting to the airport than I often spend on meals for the week!

[The Agents View]

Just to go back to one of the earlier posts. Why do you guys include meals in your calculations?? Surely you'd be eating at home? Expenses are for costs that would not usually be incurred (ie entertaining your client, or paying for 5 rounds at the bar to keep your suppliers/team happy). Crikey if I claimed expenses for every meal I ate away from home because I was working I'd be worth a fortune!!

As for the £300 pd argument - I think you'll find the very high calibre individuals becoming worth their weight in gold over the next 12 months, especially the leaders who can implement efficiencies in the operation of a business. What you might find is the IT market goes into freefall, and those who think that they deserve to be on a contract because they're in IT may suddenly become very mistaken.

For too long, the IT sector (which is not my industry fyi) has been driven by so called specialists jumping on the contract bandwagon. If Contracting/consultancy remained as it should (ie a call off resource, or to bring strategic direction to a failing co./project/job) then the better off we'll all be. Take the developer situation for example - it's not a rare skill, it's just everyone that is a developer jumps on the contract bandwagon - permies go down because everyone "wants" contract, and we end up with a skills shortage - driving clients to take contractors. This is fine in economic boom, but during recession, people will soon get desperate and start taking perm jobs again - the contract model, in my opinion only, will soon exist purely to bring in senior, experienced resources.

But that's just the way I see the IT market from an outside perspective. I'm not even going to get started on my market (which has taken a fairly major dip across the board) because it's got to the point where it's totally unpredictable.

Rant over

TAV

[NickNick]

It's the rate that I've seen as normal for what I do (embedded engineering) and as (IME) it's now impossible as a contractor to jump sectors, you simply have to get used to it.

yim

Nah, I've jumped sectors after 10 years in telecoms, I jumped ship to a charity and then after a year, into Defence.

[expat]

My little spreadsheet* tells me that £300/day corresponds to £38869 salary, or £2793/month net.

If you have no expenses , it's £47703 salary, £3272/month net.
If you also work a full 11 months of the year, £53004, £3536/month net.

BTW 320€/day in mainland EU --> £26601 salary, £1980/month net.

Now £39k is not bad, relatively; but it's not great either. I'd have to think about cutting back, selling my house ...

* assumptions:
10 months/year in contract
10 days off over Christmas/New Year
10 days off otherwise (holidays + public holidays + everything else)
Expenses 1k/month UK, 2k/month EU.
Straight Salary.

[tim123]

I sure hope the people complaining that £300/day is low are either living down south or have some kind of major ongoing financial commitment.

Now that the banking industry is not going to be ramping up rates for some relatively easy skills (yes I know some of them are not easy) I think that even people down south are going to have to get used to 300 pd as a normal rate in the future.

It's the rate that I've seen as normal for what I do (embedded engineering) and as (IME) it's now impossible as a contractor to jump sectors, you simply have to get used to it.

yim

[MPwannadecentincome]

Week

That's less than Job Seekers Allowance!

[MPwannadecentincome]

WHS

[MPwannadecentincome]

Are you honestly telling me you couldn't live on 300 per day?

That's 1500 per week. So even with the worst tax provision that would be a grand a week in your bin.

If I couldn't live on a grand a week something is very very wrong.

Depends on:
* do you have a family to support?
* is OH working?
* how big is the mortgage?
* do you want to go on holiday?
* do the kids need extra lessons and activities to be paid for?
* etc

If you are young and single your choices are much simpler!

[MPwannadecentincome]

That's what they would pay for an Indian IT worker for those skills to sit in London (the Indian wouldn't get the £300 / day though).

It just aint worth it, leave IT like I'm doing and set something else up, don't piss your life away begging money off others living on a drip-feed if you can help it.

Plumbers get £50 per hour! And even in these hard economic times its still difficult to get one.

[jim2406]

LINQ has been around for a while now - it's not anything special

If that's just a code monkey job i would say 300 a day sounds about right

Telerik protects you from having to do a lot of the difficult stuff (at the expense of performance a lot of the time) so again it's not really a niche skill... if anything i'd expect a role using telerik to pay less!

[dude69]

Rates in finance have obviously dropped, plus this is in insurance which is finance's little brother. Also note the role doesn't exactly have a big skill list; "ajax", "CSS", "HTML" points to a front-end pixel jockey rather than a proper developer.

Take it for what it is: a cheeky low offer for a newbie contractor. I'd even say the rate was about right.

Pixel jockeys are not required to have latest version .NET and SQL experience.

And asking for Linq as well? No way.

I fit the profile well apart from Telerik, my last rate was >£500, in a back office banking role, I was looking to increase, but that's not going to happening now - the reverse in fact - so I'm pursuing other endeavours and not looking.

Made the mistake of speaking to permanent recruiters, and went to a couple of interviews, they were offering £70k max, realistically £60k, i.e. £40k net. My company's 2008 income after CT was £105k (which all goes to me without paying any more tax, sooner or later). I'm not even going to consider it.

[expat]

Nice to see that bravura, hubris and BS are still the order of the day during a major major downturn in the IT market.

£300 a day is an EXCELLENT rate in the current market. Get real.

Hiya BigYin. How real do I have to get?

If I redo the same calc as I did on the previous page, with a contract that I talked to an agent about today, here is what I get. It's in the mainland EU. Since I (and my family) live in England, that means a weekly commute; while the client might not have thought of taking that into account, he probably should because it's pretty normal. Anyway the best IT contractors are British . That gives expenses of £2000 per month: £500 per week is just enough for 1 return flight, 1 return trip to the airport at both ends, a heap hotel, and a few cheap dinners.

Now, the rate on offer has been taken down to 320€ - 350€/day. Lets see 320€. With the usual 200 working days/year (10 months work 2 months bench etc, but 10 days off Christmas New Year etc, and 2 weeks holiday; or chop it up differently if you like), that's about £50112 billed per year, or £30112 after expenses. Taking off Employer's NICs leaves a gross salary of £26601 per year.

That comes to net £1980 per month. £26601 is only about 2k more than a Mcdonalds Graduate Trainee. My partner's daughter went out with a 21-year-old Domino's Pizza assistant manager who was within sight of that.

OK, tighten your belts... but do you call this IT Contracting? For this they want Siebel and database admin/config experience, analysis skills, and high productivity with no security. It's not that they can't pay 600-700 a day, it's just that they think that they don't need to.

Well, at that level I'd be tempted to do the American Beauty option, and go to the hamburger joint. At least I'd get home every night.

[HairyArsedBloke]

I sure hope the people complaining that £300/day is low are either living down south or have some kind of major ongoing financial commitment.

Plenty of people round here getting by on the equivalent of £50/day.

Week