It is no secret that PAYE umbrella techies specialising in IT contracting have taken a drubbing in the financial services sector of late, with many leading firms imposing tough ‘take it or leave it’ pay rate cuts. This could all be about to change, according to new research from PricewaterhouseCoopers and the Confederation of British Industry.

The sector has just been through its eighth consecutive quarter of growth, with the latest one (Q1 of 2012) being appreciably above average. Jobbing contractors working through umbrella companies in the sector may be heartened to find that hiring activity rose unexpectedly at the start of 2012, with 19% of financial services companies hiring new staff.

A further encouraging sign is that, for the first time in twelve months, optimism in the sector has actually risen. The research also suggests that most of the firms are planning investment in new technology over the coming year, news which should gladden the hearts of IT contractors who have been through such bruising experiences in the sector recently.

Ian McCafferty, the CBI’s Chief Economic Adviser, attributed the welcome developments to receding concerns about the eurozone crisis, with the result that business optimism and investment intentions have improved. Even so, McCafferty cautioned, business levels have not yet returned to normal levels and the sector still faces challenging economic conditions. Nonetheless, for the first time in a long while, recovery in the sector is now on a firm footing, he added.

The news appears in sharp contrast to a recent assessment by the OECD, which predicted that the UK would slide back into recession in the first quarter of 2012.

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