In the wake of the Covid-19 pandemic, and the latest reports that the UK economy has nosedived by 20% in one month, it’s inevitable that there will be job losses. While many companies will respond by scaling back on their overheads in order to survive, this doesn’t mean that the demand for talent is any less. If your future is uncertain and you’re facing the prospect of being made redundant, or if you’ve already lost your job, it may be worth considering temporary or contract work. Not only will this give you time to assess the marketplace and figure out where your skills are needed, it could also prove a financially lucrative and liberating move.
Over the past decade, the number of contractors in the UK has shown consistent growth. This growth was sustained throughout the financial crisis in 2008/9, which saw an increase in the number of self-employed workers, including independent professional contractors. In fact, this sector was instrumental in the UK’s economic recovery from the crisis. In an uncertain climate, businesses need flexible access to specific talent more than ever. While the pandemic has hit business hard, it’s also highlighted the need for change. In order to remain competitive and safeguard against future risk, organisations are having to undertake major restructuring in many areas, including IT, operations and strategy.
These “change projects” are likely to bring about spikes in the demand for independent contractors, as businesses seek to maximise their productivity while keeping down their long-term cost commitment. A recent study showed that the top reasons organisations hire independent contractors and consultants are all related to specific expertise, such as help with responding to market regulation or improving existing technology. With Brexit changes looming and the move to a platform business model post-Covid, demand for expertise in these two areas, in particular, is set to boom.
Although the pandemic has somewhat side-lined Brexit proceedings, Boris Johnson has now confirmed that the UK will not extend past the transition period, and on Jan 1 2021 the UK will be independent of the EU. In a pre-Covid study, 30% of organisations said they expected their use of independent consultants to increase as a result of Brexit. However, plans for a post-Brexit immigration system – designed to promote a “high-skill” economy – do not currently include special allowances for overseas freelancers and contractors. It’s therefore likely that skills shortages across many high-skilled sectors, such as engineering, technology, construction and life sciences, will increasingly need to be plugged by UK contractors – meaning that rates could be set to significantly rise.
The need for access to certain skills but only some of the time has helped push the professional services industry to £215bn in the UK alone – but it isn’t just the businesses that benefit. Increasingly, the lines between permanent and temporary work are blurring to make way for roles that may have the benefits of both. For example, employers are increasingly aware of workers’ desire to have flexible working conditions, and the transition to home working instigated by the pandemic looks likely to continue. In many cases, businesses may be able to reduce their overheads by reducing their office usage, or seeking to negotiate more open and flexible terms of engagement that are mutually beneficial.
The latest data shows recruitment figures starting to rise over the last four weeks as businesses seek to restart their operations. Hiring will likely be tentative, and this makes market conditions ripe for contractors. Contracting through a recruitment agency is a great place to start, as agencies have access to a wide variety of contract jobs and are also actively working with the government to tackle Covid-related unemployment. Agencies can also act as general advisers about legislation, as well as identifying projects where your skills will command the highest premium. This can take a lot of the initial stress and risk out of contracting while you find your feet in an unfamiliar marketplace.
It may be that contract work ends up leading you back to a permanent position – many candidates on temporary assignments go on to join the company as permanent members of staff. However, for many who try it, contracting becomes their preferred working model. While there are potentially no employment benefits or guarantees of work, once you’ve built security into your contracting model to mitigate these risks, the greater freedoms can far outweigh any drawbacks.
Every year experienced professionals pack in their permanent jobs to set up their own business – picking and choosing contracts, building their networks and taking charge of their own career trajectory. The ability to control their own schedule, combined with the much higher premiums that firms are willing to pay for temporary access to skills, are the most cited factors. While those facing redundancy might arrive at contracting through circumstance rather than choice, it could end up being the silver lining to the Covid-cloud.
If you’re thinking about giving contracting a go, a good place to start is our guide on how to win contracts post-Covid. Contracting Wise have access to a wide range of expert services that can help get you up and running in no time, including a number of trusted recruitment agency partners that can help you find work. To talk to a member of our team, call: 0203 642 8679