IT Contractors expect pay rises in static market

Over 60% of UKís IT contractors expect their pay to rise by between 5-10% during 2008. Despite this, nearly half of them (49%) believe the market for their services will remain static during the coming year. Although only one in five plans to return to PAYE employment during 2008, over 90% believe the UK has a negative attitude towards contract workers.

These are the key findings of the third annual CONTRACTOR EXPECTATION SURVEY, carried out by JSA, the UKís number one specialist accountants for IT contractors. The survey aims to gauge the ambitions and plans of IT specialists for the coming year.

Of those contractors expecting a 5% pay rise, 31.5% of respondents anticipate a rise of at least 10%, while 13.15% reckon on a 15% hike and 18.9% expect upwards of that figure. Despite this optimism on pay, 19.4% of respondents think that the IT contractor market will actually shrink during 2008 and only just over one third expect a growth of 5% or more.

Once again, the survey reveals a generally high satisfaction rate with contracting, with only 20% of respondents saying they would like to return to full time PAYE employment. On a scale of 1(being very unhappy) to 10 (being extremely happy) as a contractor, 83.5% rate themselves at 7 or above - a 6.5% increase over last year.

Despite this surprisingly high level of satisfaction, more than half of respondents (63.3%) say they want more challenging work in 2008 but at the same time 56.7% hope to work less hours in order to i) spend more time with their families (79.4%) ii)have more times for hobbies/interests and iii) alleviate stress (29.4%).

The IT contractors interviewed are generally self-confident and 90% think they are good decision makers.

Over one quarter of IT contractors (26.6%) have been affected by the new managed service legislation, and of those, 81.2% have switched to limited companies with only 18.8% joining umbrella companies.

Survey Participants were also asked some lifestyle questions in order to build a more complete picture of typical IT contractors.

ï Only 10% IT contractors work mainly from home.

ï Of those, 60% feel isolated.

ï 63.3% of all respondents have some sort of home office.

ï 58.4% say they donít mind working at weekends and evenings.

ï 65.5% have one major outside interest/hobby. Triathlon/athletics, music, sports, martial arts, modelling, history and cycling are the most popular followed, by website construction, live action role play, making money via the internet, snooker, gardening, flying, sailing, skiing, sky diving, motorbikes and aviation.

ï Other interests listed include angling, steam railways, flying, racing, photography, landscape painting, ten pin bowling, snooker, rugby, badminton, travelling, DIY, property and martial arts.

ï 66.7% prefer ëchilling outí to adventure and trekking holidays.

ï Thailand (24.2%) and the USA (24.2%) are the two top holiday destinations with Spain achieving third place with 13.1% favouring its Mediterranean charms. Other favourites include France and Italy (9%), India (6%) and Cornwall (2%).

Barry Roback, Chief Executive of JSA commented: ì Despite the Governmentís ambivalent attitude to IT contractors and its inability to understand that for most contractors, freelancing is a positive lifestyle choice, there is plenty of evidence here that most IT contractors are self-confident positive people who enjoy the freedom and flexibility that contracting gives them.

ìObviously the managed service legislation has effected some contractors but it certainly doesnít seem to have put them off. On the other hand there is an almost unanimous view that the Government has a negative attitude towards them

ì This survey shows that IT contractors are generally, positive, optimistic and enterprising. They expect good pay and a decent work/lifestyle balance and unlike other sectors, they seem pretty good at identifying their needs and achieving them to an unusual extent.î

However he warns that contractorsí desire for more pay in a static market might be a little optimistic. On the other hand, contractorsí pay demands have usually been met in previous years and 2008 may well be another satisfactory year, despite the economic black clouds that hang over the world economy.