Press releaseMonday 28 January 2008

CONTRACTORS POSITIVE ABOUT 2008, DESPITE CREDIT CRUNCH FEARS

  • Contractor unemployment still falling
  • Job security of diminishing importance

Contractors are largely positive about the outlook for 2008, as figures from giant group plc, the contractor services provider, reveal contractor joblessness falling and the credit crunch appearing to have little impact on concerns about job security.

According to the latest giant research, fewer IT contractors are spending three months or more without work compared to 12 months ago. Long-term joblessness amongst contractors fell from 4.7% at the end of 2006 to 4.4% at the close of 2007, its lowest level for nearly two years. UK unemployment is currently 5.3%.

The figures also reveal that the clear majority of contractors are increasing their preference for higher hourly pay over long-term contracts, suggesting that concerns over job security are waning rather than increasing. 54% of contractors would prefer higher pay to a longer contract, compared to 49% this time last year.

Matthew Brown, Managing Director, giant group, comments: "Falling long-term joblessness and the diminishing importance attached to job security are two very strong indicators that contractors are relatively upbeat about 2008."

"Despite the expected fall-out post-credit crunch, the research suggests that contractors are not expecting a wider economic malaise – or at least one that will impact them significantly."

He adds: "There is often an upswing in demand for temporary workers during challenging economic conditions as organisations put off hiring permanent staff. So, if there is a short downturn, and the market picks up again in 2009, contractors could actually do reasonably well."

The research, does, however, reveal a few jitters heading into 2008. The percentage of contractors expecting their earnings to rise in 2008 fell to 72%, down from 76% who predicted pay increases in 2007.

Matthew Brown says: "Contractors are sounding a note of caution but we have to bear in mind that 2007 was a year of very strong, above trend growth. Nearly three-quarters of contractors are still predicting their earnings to grow, which in the five years we have been collecting data, is better than any year bar 2007."

 

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