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IT contractors confidence in the finance sector bounces back

IT contractors confidence in the finance sector bounces back
Demand from banks improves
Confidence among IT contractors over job creation in the financial services sector has rebounded to its highest level since before the credit crunch, according to research from giant group plc, the contractor services provider.
When asked which sector of the economy would create most IT jobs over the next 12 months, the largest proportion of IT contractors (30%) said the financial services sector. This compares with just 14.8% who answered the same question in Q2 2009.
Only 9.4% of IT contractors think the public sector will create the most IT jobs during the next year.
According to giant, a large number of financial institutions have ramped up demand for IT skills over the last six months as they upgrade their systems post-credit crunch. Much of this investment is being driven by mounting regulatory pressure.
The forthcoming Basel III rules and the Alternative Investment Fund Managers Directive, for example, will both require greater transparency and disclosure from banks and fund managers and, therefore, more sophisticated IT systems.
Matthew Brown, Managing Director of giant group plc, comments: Optimism about IT job creation in the financial services sector has bounced back strongly. Financial institutions are reviving projects which were put on hold during the recession. With IT departments now struggling for capacity as workloads have increased, hiring has once again picked up.
Financial services businesses are adapting their front office systems to the realities of the post-credit crunch world. They are facing huge regulatory pressure to make transactions more transparent and improve risk monitoring.
Whilst one or two banks might be trimming back and middle office staff, that seems to be against the broader trend. 
He adds: Banks and other financial institutions are investing heavily to integrate IT systems following the wave of mergers precipitated by the financial crisis. The purpose of these projects is to achieve cost savings, so these are projects banks are keen to push ahead with in the expectation of a fairly substantial return on investment.
According to the research by giant, contractors are becoming increasingly optimistic that rates will rise over the next 12 months. 63% of contractors expect their earnings to rise over the next year, compared to 58% in Q2 2009.
Just 8.8% of IT contractors foresee a fall in their earnings in the next 12 months, down from 12.9% this time last year.
Matthew Brown says: Rates for many contractors in the financial services sector were slashed during the recession. It is encouraging that a reducing number of contractors expect to have their rates cut again over the next 12 months.


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