Contractor demand in Scotland rose strongly during November 2012 at the fastest pace seen since June. Agency billings were down, but pay rates were up by as much as 8%, while the number of available contractors fell for the fifth successive month.
These facts together suggest that there are not enough contractors with the right skills available, and demand is outpacing supply as a result.
The data comes from November’s Bank of Scotland Report on Jobs, which also notes that recruiters are seeing a reduction in the number of engineering and other specialist contractors seeking contracts.
“Conditions in the Scottish labour market improved in November,” says Bank of Scotland chief economic Donald MacRae. “Both the number of people appointed to jobs and the number of job vacancies rose.”
This covers a more complex picture than it at first appears: Demand for IT and computing contractors rose markedly, but IT fell from the previous month’s first place ranking in demand league tables, as “the rate of increase eased from October”.
And despite recruiters’ difficulties in sourcing engineers, engineering and construction contractors also experienced a decline in demand growth, falling to seventh place from third in October. This may be another sign that clients are struggling to find contractors with the right specialist skills.
Although prospects for financial services contractors improved in the UK as a whole during November, the accounts and financial sector in Scotland is faring less well. It is languishing in bottom place after a third successive month of contraction, making it the only core contracting sector to remain in negative territory.
Regionally, Dundee-based agencies experienced a surge in billings at the same time as a strong deterioration in contractor availability; and Aberdeen experienced the strongest rise in contract rates.
Both of these cities host UK contractor centres of excellence: Dundee is the UK video games capital and Aberdeen is a global centre for oil and gas. The evident high levels of contractor activity recorded by the Report on Jobs suggest both these industries are performing well.
MacRae concludes: “Despite the economic slowdown, employers [in Scotland] continue to hire, suggesting a rising trend in business confidence.”