A modestly encouraging picture has emerged for the jobbing PAYE umbrella IT contractor from specialist recruiters JM Group.

The IT recruiter’s latest quarterly jobs overview suggests that both IT contracting and permanent IT staff billings have risen significantly in the retail banking sector, despite a faltering start to 2012. Compared to this time last year, demand for IT professionals has grown by 10%.

Contractors in this corner of the IT skills market have been in steady demand throughout this period, in fact, as retail banks struggle to make sweeping regulatory changes that require skilled techies for time limited projects. The first credit crunch has led to root-and-branch regulatory changes in the sector, with the result that retail banks have been on the hunt for IT contractors especially.

It is not all good news, however. These same banks also implemented severe cost-cutting measures over the previous year, which has seen a major bulge in the number of IT contractors looking for work in the sector. JM Group’s Retail Index puts the rise at 35% when compared to the same time in 2011.

The knock-on effect of this surge has been a fallback in contractor pay rates, which have shrunk by 12% on average over the last six months; however, the banks continue to offer competitive rates for the most sought-after skills. Developers who can bring classic skills in C++ and Java can expect to command daily rates of around £350 – £550, depending on experience and location.

Permanent IT staff have not seen any change in their salaries and JM thinks there is little prospect of any significant improvement in the foreseeable future.

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