The Government has more than doubled its share of usage of freelance IT consultants over the last two years to become the biggest employer of IT contractors in the country, reveals research by giant group plc, the contractor services provider. 27% of all the IT contractors in the UK now work in the public sector.
The survey, conducted among over 2,500 IT contractors, shows that the financial services sector has risen from third to second largest user of IT contractors, now accounting for 24% of the market, up from 19% in 2003. Meanwhile, the telecoms sector has slumped from second to fourth place, now utilising just 12% of the UKís IT contractors compared to 21% in 2003.
According to giant group, the research reveals the true extent to which the public sector, along with financial services, have become the prime drivers of growth in the IT industry in recent years, eclipsing the once dominant telecoms sector.
Top four sectors utilising IT contractors 2003-2005
Matthew Brown, Managing Director, giant group, comments: ìThe degree to which the public sector has shown willingness to utilise external consultants in recent years in areas such as IT has surpassed all expectations.î
ìThe public sector has always been the poor relation in terms of its utilisation of temporary IT staff, but efficiency drives and increased scrutiny of major IT projects have persuaded civil servants of the necessity of bringing in private sector expertise.î
Growing City demand could fuel bidding war
According to giant group, with growth in government IT spending expected to continue to outperform the market, and the City ramping up spending on security and compliance, the public sector will be going head-to-head with the City for the best IT staff.
Says Matthew Brown: ìThe question for the Government is whether it can compete long term with a resurgent financial services industry in terms of getting the skills it needs.î
ìWith the need to control public finances pressing, and the Cityís requirements for IT contractors growing, the Government could find itself locked into a costly bidding war. If key IT personnel are poached by the City, there could be serious consequences for the Governmentís IT agenda.î
The report by giant shows that despite current labour utilisation, the largest proportion of IT contractors (28%) predict the financial services sector will offer the most opportunities in the next 12 months. 21% expect the public sector to engage the most IT contractors.
ìThe recent wave of M&A activity, spending on Basel II and data security, is expected to boost the uptake of temporary IT staff in the City as these large-scale projects get under way,î says Matthew Brown.
Telecoms sector still suffering ñ recovery on the horizon
According to giant, one of the most striking aspects of its research is the decline in the importance of the telcoms sector in terms of its utilisation of IT personnel over the last two years.
However, giant points out that the rollout of new networking technologies, such as Voice over Internet Protocol (VoIP), and 3G mobile services, should give a long-awaited boost to the sector.
Matthew Brown comments: ìThe telecoms sector is expected to drag itself up with technologies delivering multimedia content via the Internet and on mobile handsets, which should drive future demand for IT networking skills.î
ìAs ever in the telecoms sector, where new technology tends to be cyclical, heavy use of IT contractors to provide flexible skills will be an important staffing strategy.î
Research reveals Government now biggest employer of IT contractors
After doubling its market share in two years
