Recent figures from the Recruitment and Employment Confederation (REC) and KPMG’s latest Report on Jobs showed a sharp increase in the number of temp/contractor roles in March – the quickest rate since November 2017.
Wages for such jobs – which includes contractors, umbrella workers and those working on fixed-term contracts – also increased for the first time in three months with the rate of inflation.
The report attributes the surge in temp vacancies to the easing of the Coronavirus restrictions and the rollout of the vaccine, which it says has boosted consumer confidence.
Business confidence ‘starting to flow back’
Neil Carberry, Chief Executive of the REC, said: “The strong temporary recruitment trend of the past few months has been maintained, but with a new addition – the fastest increase in permanent job placements since 2015.
“Taken together with a long-awaited recovery in hiring in London, this is a sign that business confidence is starting to flow back, even at this early stage of unlocking."
“As companies start to recruit, they will need to appreciate that the labour market is still suffering from all sorts of shortages. So, reviewing their hiring practices and doing things in the best way possible will matter more than ever.”
Demand for flexible workers could continue to grow
Industry experts say skills gaps could be a positive thing for freelancers and contractors and may result in an increase in demand for their services. This is despite the latest data from the Office for National Statistics (ONS) showing a 700,000 drop in the number of self-employed workers in January year on year – equivalent to a 14 per cent fall in the UK’s self-employed population.
Andy Chamberlain, Director of Policy at IPSE, argued this decline is largely due to now-enforced IR35 reform in the private sector and millions falling through the gaps in government Covid support.
He said: “It is clear that the ongoing exclusion of up to a million freelancers from SEISS as well as the deeply damaging changes to IR35 tax rules have left the sector undermined and disadvantaged compared to the rest of the workforce and economy."
“In past recessions, freelancers have been the driving force behind economic recovery and improving employment rates: if Government wants them to play this part again, it must consider new support and stimulus measures to heal this scarred sector.”
IGA recently commissioned a survey on the impact of IR35 on the Professional Services sector. You can find out more about that here The impact of the IR35 reform on professional services
Looking Forward
The market is showing very positive signs with demand for skills on the increase. That is certainly mirrored in IGA’s business in the Contractor Sector over the same time period. With no signs of slowing down just yet, 2021 could prove to be a great year for Contractors and Flexible Workers.
