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Demand for IT contractors rises despite lockdown

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Growth in the demand for IT contractors continued in January, despite the UK entering its third COVID-19 lockdown, according to the latest Report on Jobs (RoJ), produced by IHS Markit on behalf of KPMG and the Recruitment & Employment Confederation (REC).

While the tightening of COVID-19 restrictions was cited in the RoJ as a reason for growth falling from 55.2 on the REC’s index in December to 50.4 in January, this was still above the 50.0 threshold for growth. A 50.0 score is characterised by the REC as a flat hiring level.

Neil Carberry, Chief Executive of the REC, said the results were: “Not great, but massively better than might have been expected.” Carberry added that, while early indications of the impact of lockdown on the jobs market showed that labour demand still exists, “uncertainty is high.”

The report also showed that five IT skills were on the “scarce list” (i.e. skills in short supply among contractor vacancies): Development, Technology, IT, Software and Java.

KPMG Vice-chair James Stewart commented that while there was “an uptick in short-term vacancies”, this was largely in “blue collar” sectors. According to Stewart, this indicated that employers “are filling a temporary need for staff rather than pointing to long-term job opportunities.”

Stewart went on to add: “However there is cause for optimism as businesses carefully monitor the vaccine rollout and look forward to the Budget next month. It gives the government the opportunity to further help the recovery in jobs and revive the UK’s productivity growth.”