Increasing levels of optimism and confidence among UKs contractors
Two thirds of contractors intend to carry on contracting well into the future, fuelling the rise of the career contractor. This is according to research undertaken by two key brands within the contracting world, FPS Group, the leading umbrella administration company and ContractJobs.com, the jobs board specifically for freelance professionals.
Contracting is now more popular than ever, and the contractor of today is as likely to be male as female, with over half of contractors surveyed working in the public sector.
More than 1.6m people in the UK are on temporary contracts. As a group, there is considerable optimism about their prospects for the future. In the research undertaken, 80% felt that their opportunities will stay the same or improve, and 78% expected this trend to continue over the next 12 months.
This optimism is supported by the fact that contractors overwhelmingly choose to contract because of the flexibility it offers – 66% say that flexibility is the number one reason for contracting.
However, a significant proportion of contractors are not financially prepared for gaps in their assignments. This may be due to growing complacency based on the positive market growth over the past year and the belief that job opportunities will always be there. Research has shown that one fifth (20.8%) of contractors say they would not have enough savings to last the month if their assignment ended today.
Despite the current HMRC crackdown, contractors do not appear to be taking note of the rules and regulations that are directly affecting them and their financial wellbeing. FPS Group research has shown low levels of awareness of key legislative terms, and worryingly, 1 in 4 contractors are unaware that they could be personally liable for any unpaid taxes if HMRC judged that their company was using a non-compliant tax structure.
Matthew Huddleston, managing director of FPS Group, said “We are seeing increasing levels of optimism among contractors at the moment. This is helped by the improving economy as well as the fact that there are more opportunities for contractors than ever. Recent statistics by the TUC show that the number of temporary workers in the UK has risen by 89,000 in the two years to end of December 2012, to reach 1.6 million.
“Engaging contractors gives companies the flexibility to expand and shrink their workforce in line with their current projects and workload. Contractors are taking advantage of this, but it is important that they do not forget about their administrative affairs, either by engaging with an umbrella company or by undertaking the correct and legal tax administration themselves.”