Contracting is clearly paying, as the number of contractors and temporary workers earning more than their permanent employee counterparts increased to 36% in January 2015, up from only 19% in March 2014.
Furthermore, over half contingent workers are paid the same as their permanent counterparts, suggesting that contracting is an increasingly attractive lifestyle choice for employees with the right skills who are prepared to make the transition.
This is according to February 2015’s Recruitment and Employment Confederation (REC) JobsOutlook in which REC chief executive Kevin Green highlights: “The option of taking on temporary work is becoming more attractive and this is indicative of a labour market where the need for talent is acute and skilled workers are in increasingly short supply.
“Ninety-three per cent of employers tell us that they have limited capacity to take on additional work, and many businesses are prepared to pay more for temporary workers in order to boost productivity and capitalise on the improving economic climate.
Green is upbeat about the prospects for those choosing to join the flexible workforce: “This is great news for jobseekers and for recruiters who are in a strong position to negotiate pay, especially in areas where demand is particularly high such as engineering, technology, and driving.”
ContractorCalculator CEO Dave Chaplin believes that these numbers contradict critics of the rise in contracting and self-employment during recent years: “Rising contractor numbers have all too often been blamed on cost cutting by client organisations who don’t want the expense of hiring an employee. This JobsOutlook shows that this is not the case.”
Chaplin agrees with Green’s analysis that in many skill areas, such as the core contracting disciplines of IT and engineering, the workers are calling the shots and demanding - and receiving – higher pay as a result.
“Another key finding of February’s report is that 75% of clients ‘cited ‘short-term access to key strategic skills’ as the dominant reason for use of agency workers’,” he says. “Only 44% ‘stated that they used agency workers to control costs’. This reinforces the report’s findings that clients want contractors and other contingent workers for their skills and not because they are cheap.”
Skilled technical and engineering workers are in short supply both in the permanent hiring and agency worker sectors. Budding contractors who are currently employed but who have those and other in-demand skills and are keen to test out their contracting career should find a ready supply of contracts, should they take the leap into contracting.