Contractor billings continue to rise at a marked pace as clients seek to mitigate the impact of a potential Brexit whilst accommodating rising demand.
This is according to the Recruitment and Employment Confederation’s (REC) Report on Jobs for April 2016, which shows that contractor placements have accelerated to a 13-month high – in contrast with the seven-month low recorded for permanent staff.
“The UK labour market is going through an unsettled patch, with uncertainty around a possible Brexit and the impact of the National Living Wage changing employer behaviour with a switch from permanent to temporary hiring,” notes REC chief executive Kevin Green.
“Employers are turning to temps and contractors to provide a flexible resource, as a way of hedging any possible change to the UK’s relationship with Europe, and the implications this would have on the economy.”
Overall demand for contractors also improved on March’s 33-month low, although the expansion was fairly muted. The report shows that private sector opportunities for contractors are more readily available than those in the public sector.
Rising demand has also resulted in a significant increase in average day rates for contractors. The rate of increase accelerated to the strongest seen since July 2007, with Midlands-based agencies reporting the sharpest upswing.
“With plenty of distractions and causes for concern for clients, contractors are fortunate enough to be benefitting from a contract-rich market,” highlights ContractorCalculator CEO Dave Chaplin. “Contingent staff who are currently between contracts should seek to take advantage of these conditions whilst they still can.”
It seems that many contractors have already caught on to the favourable conditions. Whilst contractor availability continued its downward trend in April, the rate of decline was the least marked in 31 months.
With London leading April’s broad-based rise in contingent placements, it’s little surprise to see the finance sector climbing up the contractor demand league table – rising from fourth place last month to second.
The construction sector has risen to third, despite the latest Purchasing Manager’s Indexes (PMIs) reporting only moderate growth in terms of headcounts in the sector. Meanwhile, IT contractors prop up the table, with the engineering sector rising to seventh.