The demand for IT contractors has stopped growing in December 2022

Demand for IT contractors in the UK took a step back from the precipice of not growing in December 2022.

After 50.9 in November (the lowest demand reading of the year for IT contractors), appetite for them rose to 51.9 last month.

The December score released by the REC places demand for IT contractors a small but significant 1.9 index points above what the Human Resources Board calls the “growth threshold” – 50.0.

The reading confirms the REC’s prediction to ContractorUK that well-paid tech workers to freelance will continue to be ‘actively sought’ in 2023, despite the struggling economy.

“The Great Trial”

But in the employment agency’s ‘Jobsreport’, which includes the monthly index released last week, there is a warning:

“The big test for the labor market comes this month,” says the report, looking ahead to January 2023.

December is atypical for recruitment, partly due to the bank holidays making it a short month, but December 2022 also saw “high inflation and “economic uncertainty.”

“December hires moved to January”

In the clear hope that this twin pressure will have eased by January 2023, the organizations have postponed hiring activities into the new year, added REC chief executive Neil Carberry.

True hiring intentions may therefore be easier to gauge now than last month, but strikes and staff shortages “mean wage inflation will ease only slightly,” says KMPG’s Claire Warnes.

Techies who specialize in software development will be among the most protected from any rewards, according to another report.

“Software developers collect 7.1%”

According to Indeed.com, software developer salaries grew 7.1% year over year, up 2.1% sequentially — a bigger increase than nine other sectors.

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Software developer salary growth was measured in November 2022 (a month ahead of the latest REC data) and described as “wages” in the Indeed report.

But in a sign that permanent employment may not be all that different from contract in the current climate, “software” and “software engineering” were scarce across the board in December 2022.

‘in short supply’

Similarly “short” last month were analytics, cybersecurity, data, data engineering, development and IT/technology on both full-time and contract basis.

Recruitment & Employment Confederation (REC) member agencies also reported a shortage of applicants for positions requiring data science, digital and infrastructure analysis.

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