Contractor prospects in the finance and IT sectors look promising going into the year ahead, show two key labour market reports. This is despite a disappointing tail-end to 2015.
Contractor demand in London’s financial centre suffered predictably in December 2015 as a result of the Christmas and New Year holidays, with Morgan McKinley’s London Employment Monitor reporting a 33% decrease in terms of contract vacancies, month-on-month. As a result, contractor demand also dipped to 7% below that seen in December 2014.
However, more encouraging news comes from the findings of the latest Confederation of British Industry (CBI)/PwC Financial Services Survey – December 2015, which shows that optimism within the finance sector increased by 6% during Q4 2015, compared with three months prior.
“December’s London Employment Monitor doesn’t make for pretty reading for finance or IT contractors,” concedes ContractorCalculator CEO Dave Chaplin.
“However, looking ahead to what’s predicted by the CBI/PwC, there are plenty of positives to be drawn for the two standout sectors from last year. We can fully expect business to pick up from this festive blip.”
The London Employment Monitor does point towards a promising start to the year for contractors, with strong figures recorded so far in January with regards to appointments made and general business activity on behalf of contingent staff and clients.
“There’s enough evidence to suggest, going into the New Year, that we could expect that trend to continue upward,” adds Morgan McKinley Financial Services Operations Director Hakan Enver.
The CBI/PwC report agrees, noting that demand growth will be in large part due to an expansion in business volumes, particularly within areas such as life insurance, investment management and building societies – all of which could be useful sources of contract opportunities for contractors.
Employment statistics revealed a negative balance of -17%, with more firms opting to slash permanent headcounts than increase numbers in the final quarter of 2015. This is positive news for contractors, suggesting that reliance on contingent finance workers will increase should business levels exceed expectations in 2016.
Meanwhile, the financial sector looks set to present a wealth of opportunities to IT contractors, with the survey showing that financial firms plan to increase investment in IT by 54% on average.
This is as a result of attempts to fight off emerging new competition, as well as fears over cyber-crime, meaning contractors with cyber-security experience can expect to be particularly sought-after.
“The growing spectre of cyber-crime looms large and the threat of major attacks continues to stalk the entire financial services industry,” notes PwC UK financial service leader Kevin Burrowes, who cites recent research showing that cyber-crime is now considered to be the top risk faced by the industry.
“As the Financial Services Survey shows, the market is still in a healthy state,” concludes Chaplin. “Contractors in both sectors can remain confident about sourcing new contracts during 2016.”