Permanent IT demand suffers big fall, but contracting resilient
The latest job market data from APSCo shows that the permanent IT recruitment market is “suffering badly”.
According to the recruitment body, the number of permanent IT workers placed has fallen 14% year-on-year, and vacancies have shrunk by a worrying 16%.
Fortunately, the demand for contractors appears to be far more resilient, registering a 2.7% increase in assignment placements over the past 12 months.
85% would recommend contracting to a friend
According to the findings of a contractor survey carried out by Pulse Umbrella, contractors are a contented bunch. 74% said they were confident or very confident about the current demand for their skills, and 60% haven’t even called in sick over the past two years.
Unsurprisingly, most respondents cited the improved pay as being the best thing about contracting, compared to being a permanent employee, and the worst thing – being responsible for finding new sources of work at the end of a contract.
HMRC to tackle tax avoidance in LLPs
The Government has launched a consultation into Limited Liability Partnerships (LLPs), following claims that this type of business structure is being increasingly used to hide ‘disguised employment’, and to manipulate the tax arrangements of partnership members.
The Government plans to prevent traditional partnerships, as well as LLPs, from “being used in ways that can give rise to certain tax advantages.” Profits don’t need to be distributed according to the effort put in by each partner, which means the proportions can be changed on a yearly basis, making the most out of each partner’s tax advantages.
Although IT contractors do not use this type of structure, the IR35 rules were created in 2000 as a reaction to the increased use of limited liability companies by so-called disguised employees at the time.
From reading the initial consultation documentation, it seems likely that HMRC will use similar ’employment status’ tests to determine whether or not a partner is truly ‘self employed’, or actually a disguised employee.
You can read more about the consultation here. Any proposed changes will become law in April 2014.
Comprehensive Spending Review
Last week, the Chancellor announced his second comprehensive spending review, which includes £11.5bn of new cuts to be found by Government departments, and further cuts to public sector pay.
It is too early to estimate what the impact of the planned cost-cutting will be on IT contractors, although the public sector may be forced to take on more ‘flexible’ workers as a result of the loss of permanent workers.
Interim body releases 2013 survey
The Institute of Institute of Interim Management (IIM) has released its 2013 survey of the interim management market, using feedback from almost 3,000 members of the interim community.
Much of the guide focuses on the role service providers (recruiters) play – including a list of the Top 100 Interim providers. The guide also provides advice on how to approach service providers, build up your profile, and how to maintain successful relationships with recruiters.