IT contractors are looking at the financial services sector for job opportunities as it rebounds strongly from the credit crunch, while the public sector enters a crisis of its own.
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The recent financial services slowdown, which started with the credit crunch, resulted in financial services businesses cutting staff in their thousands. The sector relies heavily on technology and until the financial crisis was seen as the place to be for IT professionals. Then the credit crunch saw thousands let go as banks cut costs and rationalised. Many IT professionals saw the public sector as a safer bet going forward.
But things have changed. The public sector now faces its biggest ever cuts and IT is bound to take a huge hit. Meanwhile research from contractor service provider Giant Group reveals that the finance sector is recruiting IT workers again.
The research found that 36.7% of IT contractors think the financial services sector will create the most IT jobs over the next 12 months. This compares with 22% this time last year.
"The private sector recovery is well and truly under way," said Giant Group managing director Matthew Brown. "The banking sector in particular is growing at the fastest rate since before the financial crisis and those same team leaders who were told to let contractors go at the start of the recession are being instructed to start hiring again.
"The big commercial banks are in a much better state than they were last year and many are beginning to kick-start projects that stalled during the recession. Investment banks are also back in rude health after their near-death experience, although recent results suggest the sector is not yet consistently firing on all cylinders."
The company said that the number of IT workers who had been without work for 90 days or more dropped significantly this year to 6.5% compared with over 10% last year. Before Lehman Brothers collapsed, triggering the financial service crisis, this figure was 5%.
But the public sector, like the finance industry, is home to hundreds of thousands of IT professionals in the UK, and it is heading in the opposite direction. Just 4.5% of IT contractors expected the public sector to create the most IT jobs in 2011 - a massive drop from the 24.7% figure recorded in the fourth quarter of 2009.
"With the public sector facing large-scale redundancies, there will be little room for additional spend on temporary staff over the next year," said Brown "A lot of projects that would have created opportunities for contractors are either being put on hold or axed altogether."
According to Brown, contractors might be at an advantage compared to permanent staff: "While the outlook for contractors in the public sector may look bleak now, the public sector will remain under intense pressure to keep permanent headcounts down for some time. In the medium term, this could create opportunities for contractors, who may benefit when the public sector experiences short-term spikes in project work."