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The availability of contractors rose for the eighth successive month in December. Forty-four per cent of recruitment consultants reported an increase in availability whilst only 15 per cent reported a decrease. Recent redundancies were seen to have helped swell the pool of available workers.
Agencies reported the availability of permanent staff rose at the fastest rate in the survey's four year history in December, improving for the seventh consecutive month and contrasting sharply with the widespread skill shortages experienced at the beginning of 2001. Again, the rise was linked to recent redundancies.
Contractors
Billings from contract workers fell for the third month running in December, however, the rate of decline showed signs of slowing. The drop reflected fewer contract assignments, in turn attributed to the slowdown in economic growth. The rate of decline was only modest however, and was the weakest recorded over the past three months.
According to REC, the slower rate of decline in demand for contractors than in demand for permanent placements reflects an ongoing preference amongst employers for a flexible workforce.
The pattern of demand for contract staff varied significantly by sector in December. Again, IT recorded the sharpest decline (a new record fall for the survey), dropping for the 10th successive month. The rate of decline was reported as easing for contract workers in all other sectors.
No significant growth was reported in contractors' hourly rates for the second consecutive month. Rates growth slowed sharply over 2001, attributed by consultants to the downturn in client demand. Margins on contract workers dropped for the eighth consecutive month, falling at the fastest rate in the survey’s four-year history.
No skills were reported in short supply this month within the IT contracting sector, according to REC.
Permanent staff
The number of people placed in permanent jobs by recruitment consultancies fell for the eighth consecutive month in December. However, the rate of decline eased to signal the smallest drop in placements since September. Nevertheless, the continued decline in placements represents a marked contrast to the strong growth seen earlier in the year and reflects still weak business confidence among employers.
The sharpest rate of decline in the hiring of permanent staff was again recorded in the IT sector, with demand falling for the eighth consecutive month, deteriorating at the fastest rate in the survey’s history. Demand for Executive/ Professional staff also fell for the eighth successive month whilst demand for Accounting/ Financial staff fell for the fifth consecutive month.
Permanent salaries fell for the third consecutive month in December. The rate of decline was less than that recorded in November, but still represents a significant turn-around from the sharp rate of increase seen at the beginning of 2001. Lower salaries were attributed to the weakened demand for staff in recent months.
Only 'Software Engineers' were reported in demand in the IT sector.
According to Jobstats, the market and rates statistics website for IT workers:
The average hourly IT rate for contractors is £22 per hour and the average annual rate for permanent employees is £36,800 per annum.
Will 2002 spell a different picture? |
The top five skills are:
Support 22 per cent - Average rates: £18 per hour/ £32,900 per annum
Design 16.4 per cent - Average rates: £36 per hour/ £37,900 per annum
Management 15.4 per cent - Average rates: £29 per hour/ £41,000 per annum
Unix 14.9 per cent - Average rates: £33 per hour/ £39,000 per annum
Financial 14.6 per cent - Average rates: £33 per hour/ £44,500 per annum
(Note: Hourly rates refer to contract positions, annual rates to permanent)
The top five locations are:
London 23.4 per cent - Average rates: £25 per hour/ £45,000 per annum
Berkshire 6.3 per cent - Average rates: £24 per hour/ £38,700 per annum
City 6.3 per cent of jobs - Average rates: £25 per hour/ £50,400 per annum
Surrey 5 per cent - Average rates: £17 per hour/ £35,200 per annum
Hampshire 3.5 per cent - Average rates: £15 per hour/ £36,800 per annum
Nick Wells, author of Jobstats, said: "There was little in the way of good news last year with the market contracting relentlessly from January onwards and rates falling correspondingly. Contract rates have fallen by between 30- 40 per cent and permanent rates have fallen by four per cent. The contract market fell as a proportion of the total (from a peak of around a third of all jobs (in August 2000) to less than a fifth (in October 2001).
"That's the bad news. The good news is that permanent rates offered have stopped falling and even risen slightly over the past couple of months. Contract jobs have risen as a share of the total since their trough in October (no sign of any rise in contract rates though).
"In terms of the skills that are up or down. Java has fallen from its pedestal and no longer challenges C++ in the job offer stakes (and the rates offered have fallen back into the same range as C++ too). A noticeable riser last year was SAP skills. More and more adverts mentioned that skill set and it recently entered the top 20 (it's dropped out again recently but this time of year the figures are all a little more volatile)."
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Richard Powell, Shout99
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