SEEK’s latest employment marketplace data published this week suggested that Australians looking for work in the ICT industry could have the best luck landing a job, with the sector continuing to lead new job advertisements during January 2015.
The Information, Communications and Technology industry was responsible for 10.7 per cent of total SEEK new job advertisements in 2014, representing the largest employment advertising classification. SEEK Employment Report.
The ICT contracting and recruitment sector has always known that the market generally follows the 80/20 rule in which 80% of roles were for contracting and 20% for permanent. Well things have started to change. Now 87% of advertised roles are for contractors and only 13% for permanents according to BurningGlass. This significant shift is a key finding in the ITCRA ICT Employment Trends Report for the December quarter.
This is a national result so it is not a consistent statistic across all states, sectors and roles (as I know from the regular calls I get from ICT professionals looking for roles who unfortunately have skills that are not in demand or are located in the wrong State or Territory where demand is reduced). So let’s look more closely at the data. In Queensland and Western Australia there is a heavy number of contract roles compared to permanent roles (94% to 6% in Queensland, 95% to 5% in WA).
Interestingly the highest number of permanent roles to contract was in Victoria with 17% permanent compared to 83% contract roles.
Why is this shift happening now?
Even though we have moved on from the GFC, it may have had a lasting impact on the nature of work. Perhaps employers have realised the value of investing in “project based teams” which assists in managing the financial and morale impacts of redundancies should the business not reach its targets or projects fail. Consequently hiring contractors, with the ability to conclude or extend their contracts as needed, is appealing. Or has the push come from the market with ICT professionals happy to take on the lack of permanency for increased variety and choice in the roles undertaken and the tenure involved.
What are the possible consequences?
With increased demand we could soon see this change flow through to increased hourly rates. Contractors in Victoria and New South Wales are now earning almost twice that of their permanent colleagues, and in the smaller states and ACT, it is about one and half times the rate of permanent placements. Contractors, employers and recruiters will no doubt be closely watching to see if rates move higher in such a market.
In addition, the contractors who will do well will be those who articulate how they can improve business value and profitability. CIOs and CTOs have been pushing their way into the board rooms and executive meetings, and ensuring that IT is part of an organisation’s strategy rather than an adjunct to it. In my view this appears to be feeding down the line as organisations appreciate that their IT professionals directly add value to the business. Several reports we are reading show that hiring intentions, and job advertisements are reflecting this new focus of ICT talent’s value in improving business strength.
So, to all those ICT recruiters out there it isn’t news to you that the talent you manage continues to be in high demand, that contracting is growing as the preferred model of engagement and that hourly rates are increasing, but it seems that clients are now realising the value that quality ICT talent contributes to business improvement.
Let’s hope we can all benefit from a time when the force is with us – it has been a while coming!
itcraceospeaks.wordpress.com 