Crystal Umbrella

New research reported in Shout 99 confirms that growing numbers of PAYE umbrella contractors specialising in the IT skills market are moving into the telecoms sector.

The study by giant group plc reveals a 43% leap in the number of contractors opting for telecoms jobs over the last twelve months, largely in response to demand from retailers as they pump more investment into mobile internet marketing. This represents a rise in the proportion of IT contractors working in telecoms from the 12% recorded last year to 17%this year.

High street retailers have been badly bludgeoned by the economic downturn and are developing m-commerce platforms vigorously in an attempt to revive their fortunes, as more consumers shift their purchasing habits away from bricks-and-mortar shops towards their online equivalents, the study suggests.

The total spend on internet purchases reached £7.9 billion in December 2011, representing a rise of 16.5% on the figure for the previous Christmas. Many of these online purchases are made using smartphones and tablets, hence the new investment in m-commerce platforms.

The MD of giant group, Matthew Brown, said:

“Ironically, despite some retailers struggling, retail is one of the few sectors which increased its use of IT skills over the past year. Compared to the banking sector, retailers have never been particularly intense users of IT skills, but that is changing fast as retailers channel investment into m-commerce platforms.”

“A surprising number of retailers don’t offer e-commerce functionality. With consumers becoming more demanding about how they shop, and legacy systems often a serious bottleneck, investment in IT is key to gaining competitive advantage.”

PAYE umbrella contractors seeking new opportunities in the IT skills market in 2012 may be in for a good year, with the giant IT firm Hewlett-Packard promising to share its public sector work with small businesses and accountancy leviathan Deloitte forecasting an expansion in ‘big data’ projects over the next twelve months.

Hewlett-Packard is currently the government’s biggest IT contractor and has announced that it will increase the number of SMEs in its supply chain from 10% to 15%. Techies working through umbrella companies are likely to be amongst those to benefit from the expansion in sub-contracting by the IT giant.

By making this move, which should see the 600 small firms and individual contractors currently used by HP rise by a further 150, the company is endorsing the government’s efforts to help smaller firms generate desperately needed economic growth.

Accountancy firm Deloitte also had some encouraging news for the jobbing IT contractor with its forecast that large firms will launch ‘big data’ projects worth between £650 million and £1 billion in 2012. Given the economic conditions in which these projects are to be embarked upon, it is not unreasonable to suppose that many of these companies will seek to keep permanent headcounts down by hiring skilled contractors to bring them to fruition.

Deloitte’s global lead for technology, media and telecoms, Jolyon Barker, said:

“So-called ‘big data’ projects had a total industry revenue of only £65 million in 2009.However, 2012 will see 90% of Fortune 500 companies kick off a data-related initiative, which will boost the industry’s revenue to between £650 million and £1 billion.”

It’s no secret that IT contracting took a mauling in the financial sector during 2011 (permanent IT posts have also suffered) but, thankfully, the IT skills market is bigger than banking alone; jobbing PAYE umbrella techies will have plenty of opportunities in 2012 to move on to pastures new; perhaps especially in the burgeoning field of mobile platforms for e-commerce.

The Centre for Retail Research predicts that at least a quarter of all online purchases will be made using mobile devices by 2015. An indicator of the rise of mobile commerce was evidenced by the eBay subsidiary PayPal on ‘Cyber Monday’ in the US last year: three times as many people used their mobiles on this day in November 2011 as they did the previous year. One customer even used a mobile to purchase a Ferrari from an internet auction site for a cool £70,000.

‘Mobile wallets’ are gathering pace with more and more people treating them as a trusted method of payment. Mobile phones are also being used for payments and may ultimately overtake credit cards, and increasing numbers of people are using them to scan barcodes in order to make price comparisons before purchase. After its grand opening in the US last summer, Google Wallet will be launched in the UK in 2012, making it the first European country to use the technology.

IT contractors who can turn their hand to mobile-based e-commerce, it seems, are likely to be in for a very busy year in 2012: with trends like this taking off, you can bet that more companies in the UK will be scrambling to climb aboard the m-commerce bandwagon.

The country’s IT recruiters are approaching 2012 with a spring in their step, with demand for IT contracting and permanent roles alike showing continued signs of strong growth.

That’s the verdict of the latest meeting of the REC’s Technology Sector Group, which collects data from 570 recruitment agencies across the UK specialising in the IT skills market. The Group’s Chair, Jeff Brooks, said:

“I was pleased to hear from many of our members that they are looking forward to 2012 with confidence about the IT jobs market. The recruitment sector has always been good at adapting to external developments. Social media is the latest change to manage and has already resulted in specialised recruiters reinventing the way they build their brand and build relationships with clients and candidates.”

Members of the group reported that demand for systems managers and product developers was especially strong, a trend which is in line with the findings of the latest REC/KPMG Report on Jobs, which suggested growing demand for both contractor and permanent roles in the IT sector.

There was other encouraging for news for PAYE umbrella contractors of the techie kind: November’s Employment Index UK from Monster reveals that the IT sector has grown by 25% compared with the same time last year, placing it at the top of the index’s growth sector ranks.

Monster’s UK and Ireland spokesman Michael Gentle said “The seasonal rise in temporary positions across sectors such as transport has supported overall annual gain of 8% in November, counter-balancing the effect of slowed growth across other sectors.”

Contractors working through umbrella companies in the IT skills market should concentrate their energies on cloud computing skills, a new report from the IT recruitment agency Modis suggests.

The company polled 250 IT decision makers in the UK and found that 36% of them – well over a third – believe that the progressive uptake of cloud computing has produced major changes in the role of the most sought after IT professionals. Moreover, the trend is likely to accelerate in 2012, as Modis Managing Director Jim Albert explains:

“Although cloud computing was supposed to flourish in 2011, the process of integrating this technology into business systems has taken longer than expected. As a result, next year’s major IT innovation will come in the form of effective utilisation and implementation of cloud technology.”

IT is no longer a behind-the-door background technology, Albert insists, but an integral component of a successful business strategy, especially with the rise of cloud computing. He went on:

“IT professionals are amongst the first to feel technological changes in the workplace, but are also amongst some of the best placed to meet any challenges head on. As cloud computing continues to develop, those with relevant skills will find themselves in high demand across the recruitment spectrum.”

The Modis report concludes that firms are especially interested in certified candidates; they are seeking talent capable of protecting them against cyber threats and maintaining the security of their networks. IT contracting specialists in the know about cloud security are likely to be especially in demand next year as a result.

Jobbing PAYE umbrella contractors on the lookout for new work may wish to take a closer look at the online jobs market, according to new figures released by the internet jobs leviathan Elance.

Freelance software developers and others in the IT skills market are amongst those receiving a little seasonal cheer from the online jobs platform. The company’s annual figures have just been released and reveal the number of employers who sourced their temporary staff online has more than doubled during 2011, with every indication that the same will occur in 2012.

650,000 additional temporary jobs and contracts were posted on the website during 2011, a rise of 120% on 2010. It’s a figure that is well on course to double next year.

Elance Chief Executive Fabio Rosati said that the figures herald a “structural change in traditional employment.” Significantly more employers are turning to online and contingent work “as a core business strategy,” he added. Eight out of ten SMEs polled by Elance say they will hire up to half of their new appointees as freelancers sourced online. The shift away from traditional patterns of permanent 9-to-5 posts will also interest contractor’s working through umbrella companies.

Experts in the field of IT contracting will be interested to find that software roles (especially those concerning HTML 5) showed particularly strong growth, although internet marketing jobs rose by 132% and graphic design roles by 176%. Content writing, too, enjoyed a surge, rising by 72%. Perhaps reflecting the increasing popularity of Facebook and Twitter, demand for marketing comms contractors also rose by 53%.

Specialists in IT contracting may be surprised to find new placements in a setting that has recently been cutting headcounts faster than a crazed Jacobin – the public sector. New research from Computer People reveals that public IT contract roles rose by 4.3% in September, reversing a trend that had in place every month since April.

During the same month, public sector permanent IT appointments continued to decline, although less sharply than previously. Umbrella companies supplying the IT skills market will not be blind to the fact that this is the first sign of non-commercial confidence in contractor hiring for at least two quarters.

The report concludes that in both local and central government agencies, business critical projects are still proceeding. Computer People director Sid Barnes said that, although times are still tough, the public sector “is more inclined to staff up with contract candidates, as hiring managers will have more flexibility and can attribute the cost to direct project line budgets, rather than incurring a fixed cost.”

He noted that contractor appointments have fared better than permanent equivalents over the last half year, suggesting that contractors are now picking up work that would once have gone to permanent appointees.

Mr Barnes continued “There was also a large increase in the number of projects that were taken off the shelf and new projects approved. Hiring managers also had new approved budgets and wanted to staff up early whilst quality contract staff were available.”

End-users are likely to increase their hiring of IT contractors in the first quarter of 2012 to spend excess budget before the close of the financial year.

Contractors in the financial corner of the IT skills market have been taking something of a battering in recent weeks, with pay rates being slashed by 10% and many IT contracting experts forced to take an obligatory two-week unpaid break over Christmas. As the Eurozone storm clouds darken, financial services are rationalising their expenditures and cutting IT projects – a far cry from the more optimistic picture during the summer.

One industry expert believes that the near future will not necessarily be a demoralising one for PAYE umbrella IT contractors. Peter Job, who is Chief Executive Officer of Intergence, the IT optimisation consultancy, said that in the current economic conditions, more UK firms will be turning to highly skilled contractors. There is simply no time to waste with executing essential IT projects, he explained, and companies will be looking to hire more, not less, on-demand skilled professionals to meet these needs as economically and swiftly as possible.

Employing permanent staff not only involves spending money on holiday pay, sick pay, etc., but also using precious time in training them up to get on with vital IT projects. Businesses are more likely to hire skilled experts who can hit the ground running and then move on when the project is completed, Job believes.

He added “A combination of a volatile economy and increasingly complex IT environments, on demand IT resourcing is the most cost-effective and efficient way in which to bring in the necessary skills and expertise.”

Despite relentlessly gloomy recent forecasts about the UK economy’s prospects for growth, placement-hunting contractors working through umbrella companies have some reasons to be cheerful, thanks to a new survey from the Reed recruitment agency. Specialists in IT contracting in particular have more reason to smile than many.

Reed’s latest Jobs Index, which covers the month of October, records a surprising eight-point increase on September’s figure, climbing from 121 to 129. The number of available job opportunities has returned to levels last seen at the beginning of the year, when the economy appeared to be more firmly in recovery. Moreover, employer demand has risen by 23% compared to the same month last year.

While the index surged most vigorously for the voluntary sector (up 43 points), the IT skills market also proved to be in fine fettle, with the sector rising by 24 points. Temporary roles, too, have grown since September, up by 2.5% – a figure that should bring at least some cheer to the jobbing PAYE umbrella contractor.

Reed’s Group Managing Director, Tim Lovell, declared that the October Index recorded the healthiest month-on-month surge in job opportunities for two years. It seems clear that all regions have seen at least some degree of growth.

Mr Lovell went on to say “While recent reports have focused on a north/south divide in employment levels, the real picture is not that clear cut, with strong demand for candidates in both the north and south of the UK. Our job index shows that demand for candidates has increased across all regions, with particularly strong growth in London, and Yorkshire and Humberside.”

IT contracting specialists working through umbrella companies may be heartened to discover that, while permanent staffing opportunities fell last month, temporary billings – especially in the IT skills market, engineering and professional services – climbed slightly, according to the latest REC/KPMG Report on Jobs.

The dip in permanent billings was the first fall recorded by the REC survey in over two years. The report, which is based on a poll of 400 UK recruitment and employment agencies, attributes the decline to hesitancy amongst employers due to the general economic outlook. Even so, successful candidates for permanent posts in October were awarded starting salaries that were broadly in line with previous months.

KPMG’s Head of Business Services, Bernard Brown, said “Nervous employers are placing recruitment decisions on hold amidst concerns over the economic outlook, in many cases choosing instead to plug gaps with temps. There is some positive news with more permanent opportunities in IT, finance and accounting showing signs of improvement. However, we are still on a knife edge as we enter a critical time for European economic stability”

REC Chief Executive Kevin Green hailed the increasing use of skilled temporary workers, such as PAYE umbrella contractors, as “fantastic news”,” not least because many had feared they would suffer due to the implementation of the Agency Workers Regulations in October. He added “This again demonstrates the importance of the UK’s flexible workforce in helping businesses meet fluctuating demand and keeping people in work.”

IT professionals with Java skills were most in demand for permanent posts, and Java experts and business analyst topped the bill in the temporary sector.