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Contract market in Scotland softens further: should contractors look south for work?

Contracting in Scotland suffered a further month of “broad stagnation”, according to March 2015’s Bank of Scotland Report on Jobs. The report also highlights that the “lacklustre performance seen in Scotland” was in contrast to “a further strong increase in temporary billings across the UK as a whole”.

“Contractor demand growth in Scotland is at a two-year low, with six falls in the last eight months,” notes ContractorCalculator CEO Dave Chaplin. “The broader UK contract market has outperformed Scotland for the thirteenth consecutive month. This suggests that contractors struggling to find work might have to look beyond their local client base.”

Scotland’s contractor market is dominated by oil and gas, financial services and video gaming. The geographic variations in demand shown by March’s report highlight how the dynamics of these markets are impacting on contractor demand.

Chaplin explains: “The report shows a sharp increase in contractor agency billings and contractor rates in Dundee, with a corresponding and ongoing fall in billings in Europe’s oil and gas capital, Aberdeen.

“Clearly, the low oil price continues to impact negatively on oil and gas contractor prospects. It is no surprise that a recent Rigzone survey shows three-quarters of oil and gas workers are considering a move overseas.”

In contrast, Dundee’s gaming industry is clearly performing well, alongside the financial sector, shown by declines in contractor candidate availability in Scotland’s financial centre of Edinburgh.

Less positively, Scotland’s interim management contractor market actually shrank, with the core contracting disciplines of engineering and accounts and financial showing sharp slowdowns in contractor demand growth.

Despite this seeming decline in prospects for contractors in Scotland, Bank of Scotland chief economist Donald MacRae remains upbeat about the country’s labour market: “Conditions in the Scottish labour market continued to improve in March this year.The number of people appointed to jobs increased while the number of vacancies grew over the month.”

MacRae also points to the latest Bank of Scotland Labour Market Barometer, an index that measures the relative health of Scotland’s labour market, which shows the highest reading for three months: “This Barometer suggests the slowdown in growth in January to March will be reversed in the coming months.”

Published: 20 April 2015

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