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IR35 compliance remains a significant concern for agencies
by Susie Hughes at 11:39 06/02/23 (News on IR35)
New research has revealed that compliance when placing contractors and talent shortage were two of the greatest challenges faced by recruitment agencies 2022.
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Following the difficulties surrounding IR35 reforms during the last two years, compliance remains a point of unease. With 52 per cent of recruitment agencies either somewhat or very concerned and 43 per cet of agencies saying that IR35 compliance has caused them difficulties when recruiting for contract positions.

Almost 40 per cent of the recruitment agencies involved in the research by digital payroll solution for contractors, Cool Company, cited lack of applicant talent as causing problems in 2022. With a further 20 per cent saying that they believe the same problem will cause issues this year.

Other areas of concern highlighted by recruiters were the demand for higher salaries, which proved challenging for 39 per cent of recruiters in 2022 and is a concern for 14 per cent in 2023. While a further 39 per cent said that attracting the right candidates was a difficulty last year, but is less of a concern this year. With more recruiters worrying about the ability to hire quickly (15 per cent) and the cost of living crisis/inflation (14 per cent) in 2023.

Optimism
However, for most (85 per cent) the outlook for 2023 is positive, with 65 per cent of agencies expecting to place more applicants this year and three-quarters saying that itís either likely or very likely that they will grow their team in 2023.

Kris Simpson from Cool Company said: "2022 raised a range of difficulties for recruiters. With economic instability, and the global talent shortage creating unfillable vacancies. But while this problem may have previously been remedied by outsourcing, difficulties with navigating IR35 legislation has obviously impacted that process.

"As we settle into 2023, talent acquisition remains a concern for many businesses, recruiters are up against it, matching applicants who expect higher pay with businesses looking to reduce overheads. However, despite the challenges, it is encouraging to see such optimism in the sector."

Further IR35 information
For more information about all aspects of IR35, including the controversial IR35 reforms see Shout99's News on IR35 section.

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