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State of Play - IT Contracting
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DateMonday, July 11, 2011
AuthorDerek Smyth

State of Play - IT Contracting

Opportunities for Skilled IT Contractors Continue to Grow & Rates are Increasing, says Brightwater's Derek Smyth



BRIGHTWATER_IMAGE.pngThe past three years have seen a massive decline in employment opportunities in general, and salaries and benefits on offer have reduced significantly in most areas. Although the IT sector has remained relatively stable, many IT companies found it necessary to scale back their operations with staff taking pay cuts in varying degrees as the recession took hold.



However, new start ups, continued strong inward investment in the sector and solid growth from a number of organisations in the IT sector, have led to many new employment opportunities for skilled candidates. In addition, specialised skill shortages and increasing emigration have resulted in a lean talent pool, and this has forced companies to increase salaries and benefits to attract and retain the best talent.



In addition to rising rates of pay, opportunities to work on interesting projects with the latest technologies are increasing, particularly in the area of software development, and for candidates who have been reluctant to move jobs due to the uncertainty in the market, it now seems a very good time to reflect on the new opportunities available.



IT Contracting - an Alternative to Permanent Employment

One option offering a range of rewarding benefits is the contracting market. As an alternative to permanent employment, this is becoming an increasingly attractive choice for many, especially as the market improves.



Contracting offers many benefits to candidates over permanent employment, and for some has become a long term preference as opposed to a short term solution. Equally for employers, contracting can be a very cost effective method of attracting key skills into the organisation when required. The potential benefits to both the employer and the employee are considerable, and now is an excellent time to consider the contract market whether for the short or long term.



For employers, there are many reasons why engaging contractors can make business sense over direct hiring.

  • Reduced costs. Employers can save money when using contractors. While the daily rate may be higher than the cost of a permanent employee, the employer can save money by avoiding a number of associated costs of employment including employers' PRSI and the range of benefits usually paid to permanent employees. In addition, employers only pay for hours worked, and therefore do not pay for public holidays, standard holidays or sick pay.
  • Efficiency. By smart recruiting, contractors can become immediately productive with minimal induction and training time. Skilled contractors usually hit the ground running, and employers can enjoy immediate return on their investment. Training costs are reduced as the client can plug a gap with a specific skillset.
  • Flexibility. Typically employers will use contractors to provide the required skills during peaks in the business cycle or for short to medium term projects. Contractors can be employed for the duration of the project only, and then either terminated or renewed as the business dictates. This flexibility offers clients considerable benefits and can allow them to react quickly to unexpected staffing requirements. At the end of the contract, staff can be let go with a minimum of disruption and without the trauma and the costs associated with redundancy.
  • Try before you buy. For some clients, engaging a contractor may be a preferred option to recruiting a person into a permanent role, even where a permanent position exists. There can be a considerable advantage in working alongside the person to see how their knowledge, skills and attitude fit with the requirements of the role and organisation before making a commitment to a permanent contract. This can work for the candidate also, as they can make a better informed decision about taking a permanent role after they have worked in the organisation for a period of time.


For the contractor, there are a number of specific advantages associated with contracting over permanent employment.

  • Higher remuneration. In terms of earning potential, contracting can be very rewarding. Contractors can frequently achieve much higher rates than they would in permanent roles even when the loss of additional benefits are factored in. In addition to better rates, for some, depending on their tax status, a greater portion of their salary can be retained after tax and expenses. Since the summer of 2010, rates for contractors have begun to recover ground lost since the beginning of the recession. Many contractors are back earning rates equivalent to rates paid towards the height of the boom.
  • Broader experience. By working with different teams in a greater variety of workplaces, a richer experience is gained. Contractors benefit considerably from this variety and tend to have exposure to a a greater volume of technologies. Where contractors are looking to increase their level of skill in a particular area, they can target key clients and projects.
  • Flexibility. Contractors have great control over where and when they work, and ultimately can achieve a greater work life balance. Some contractors may work a shorter week, and remote working can be a possibility.
  • Training. This flexibility can also allow contractors periods during the year where they can increase their skills through full time study. Contractors may choose to delay starting a new contract to complete a training course and ensure their skills are up to date.
  • Freedom. Contractors can avoid the commitment required when working in a permanent role, and can avoid the need to build internal relationships and get involved in the internal politics of the organisation in which they work. Instead, they can concentrate on the tasks at hand and move on to new challenges at the end of the assignment.



BRIGHTWATER_TEXT.pngSkills In Demand

Contracting opportunities are increasing in most areas but particularly in the areas of software development, project management, business analysis, QA and database administration. There are extensive opportunities for Project Managers in particular with experience working in multi-project software environments and with strong knowledge of software methodologies such as Agile/Scrum. Business Analyst roles are varied but in particular we have seen an abundance of positions in the financial services sector, and Insurance in particular. Business Analysts with strong data analysis skills are highly sought after at the moment.



On the development side, roles are generally split evenly between C#.Net and Java opportunities. The levels of experience required typically would be mid level (4-7 years' experience) up to Principal (10+ years'). On the .Net side, we are seeing a strong demand for skills in NET (3.5 or 4.0), WCF and SOA technologies. On the Java side, there are a lot of positions with a Spring, Struts and Hibernate component. In both areas, strong RDBMS and data skills would be important.



Experienced developers tend not to be on the market for long as there are usually a pick of available opportunities. At Brightwater, we have also had a number of roles requiring a scripting language, typically Ruby, Python and Groovy, and experience working in an Agile development environment will be a significant plus for development roles.



On the QA and testing side, we have had a consistent requirement for Test Analysts and Team Leaders, usually within Financial Services environments.



Due to the downturn, many candidates have stayed within roles that they have outgrown. As the market improves, some are beginning to actively look for new challenges and increased rewards. Contracting offers a range of advantages over permanent recruitment and suits candidates looking for flexibility, a wide range of employment experiences, access to the widest possible range of technologies and working methodologies, and strong rates of remuneration.



Technology companies are fighting to attract the best people and are offering flexible working patterns, autonomy, varied work and pleasant working environments. For contractors, there are increasing opportunities to hone existing skills, upskill in new areas and ultimately make themselves more marketable.



While there are considerable benefits to both parties, there are some disadvantages, and clearly contracting will not suit everybody. While there may be some downtime between periods of employment for the contractor, working with a good Recruitment Consultant can minimise the time spent applying for roles and ultimately the length of time spent out of employment.






_BRIGHTWATER_Logo_HR.jpgArticle written by:

Derek Smyth, IT Contracts at Brightwater IT Recruitment.










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Corporate Information


Brightwater IT Recruitment are at the forefront of the it jobs market and work with a wide range of leading organisations.


We have a variety of contract roles open at any time. If you are interested to discuss the current IT contract opportunities that are available right now or would like to receive a call back when your current contract expires, contact Derek Smyth on 662 1000 or email



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