Regulation impacts the contractor market, Morgan McKinley reveals
Morgan McKinley has revealed in its 2018 UK Salary Guide that the contractor hiring market endured a tough year in 2017. The guide reported slow progress for temporary employment, with contractors turning to permanent jobs in the accountancy and finance sectors. This was due to unpredictability in where vacancies would come available and an uncertain market caused by Brexit and a slowing economy.
However, there was a sharp rise in demand and increase of rates for regulation roles due to MiFID II, IFRS 9 and GDPR in accounting & finance banking, compliance, financial services operations and risk management. Whilst rates for many contractors remained stagnant, the competition for regulatory individuals was fierce, and higher rates were demanded as a result.
Key highlights from Contractor Market 2018 Salary Guide:
22% year-on-year decrease in temporary compliance job volumes
High volumes of recruitment across regulatory BAU space and emphasis on capital reporting within accounting & finance in banking
Investment managers in financial services operations built up regulatory teams with contractors
15.7% year-on-year movement around temporary transactional finance roles in London
Strong Q3 for temporary compliance hiring as IFRS 9 drove wholesale credit risk recruitment
IT contractor rates increased by 12%
Dramatic reduction of risk management contractor hiring in London as organisations transition business to Ireland, Switzerland, Poland and India
16% year-on-year increase in financial services temporary jobs
Decreased demand for accounting & finance banking contract roles across Tier 1 bulge banks and SME boutique banks
Victoria Walmsley, operations director at Morgan McKinley, commented, “Overall, 2017 has seen a change in hiring trends across the temporary and contract market. The changes to the intermediaries legislation, otherwise known as IR35 or off-payroll rules, were a game-changer for contractors within the public sector. There has certainly been an appetite within Financial Services to recruit more permanent heads and we have seen a noticeable increase in the number of contractors converted to permanent, our highest number in 3 years. This sentiment is supported by the overall results for the UK employment market; the Office for National Statistics reports that the UK employment rate was 75.3% in 2017, which is the joint highest since comparable records began in 1971.
“There has also been an increase in the number of Fixed Term Contracts available, particularly within small and mid-tier organisations and perhaps some of the uncertainty from 2016 seems to have given contractors more interest in longer term contracts which tend to offer more security.”
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