So it is official – the IR35 reforms are now effect. It may be seen as a scary time for public sector contractors, and it is – on so many levels! In one of our previous articles, we discussed how 85% of PSCs plan to quit the public sector if their respective clients deem them to be inside IR35.
This is not surprising at all, given that it is now the end client’s responsibility to decide the employment status of the contractors. And since they don’t want any trouble from the taxman, they have been taking a precautionary step against the contractors.
According to Harvey Nash Recruitment Solutions, one of its four candidates is leaving the public sector. However, a new poll of 600 contractors by Optionis taken recently painted a slightly different picture – and that’s all because of Article 50 being triggered. From a hiring point of view, contractors pose a lesser risk than full-time employees.
In the IT sector, the demand for contractors is on a rise. This has got to do with the fact there is a scarcity of IT skills for full-time jobs and hence, freelance technologists have gained dominance in the industry. Moreover, the IT contractors have witnessed a decrease in rate cuts from 19% (June’16) to 17% (April’17).
In the Financial Services (FS) sector, on the other hand, only 22% of contractors have observed a rate cut as of now. But six months ago, it was 29% of contractors who had to endure pay cuts. The positive thing is the demand for project managers, contract business analysts and program managers in the FS sector is at a peak!
Therefore, now is the time for contractors to switch jobs with attractive pay packages on the deal. Rising inflation and stagnated pay growth have made it possible for contractors to search for new jobs in the market for money.