Government doubles use of IT contractors

The UK government has more than doubled its use of IT contractors, going from one of the smallest users of self-employed workers to the biggest in just two years.

A survey of over 2,500 contractors has shown that the government employed less than 15 per cent of the UK contractor base in the last half of 2003, but almost 30 per cent by the end of last year.

However, the boom in government work was matched by a falling need for telecoms contractors, where demand has halved in the past two years.

"The degree to which the public sector has shown willingness to use external consultants in recent years in areas such as IT has surpassed all expectations, " said Matthew Brown, managing director of contractor recruiters Giant Group, which commissioned the survey.

"The public sector has always been the poor relation in terms of its use 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."

The second biggest contractor employer by sector is the finance industry, which was seen as the area with the biggest growth potential.

Brown explained that new regulations such as Basel II, and increasing security infrastructure, are driving demand in the sector and could lead to increased wage demands from contractors.

"With the pressing need to control public finances, and the City's growing requirements for IT contractors, the government could find itself locked into a costly bidding war," concluded Brown.

See also:

Push comes to shove in wireless sector

Demand ramps up for easy to use products, not hype  15 Dec 2005

Contractor group slams Chancellor over IR35

But PCG welcomes some elements of pre-budget report  07 Dec 2005

Lobby group slams IR35 investigations

Government criticised over 'success' rate of less than one per cent  17 Nov 2005

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