Uncertainty around recruitment has led to an increase in the number of opportunities for contractors, according to research from APSCo.

While Office for National Statistics (ONS) figures show that the number of new permanent vacancies is beginning to slow compared to Pre-Covid, APSCo data shows that opportunities for contractors increased 13% in July 2022 compared to July 2019.

Permanent opportunities decreased 23% in this same period.

APSCo data also shows contractor opportunities are growing in the short term - up 7% between July 2021 and July 2022.

Anne Swain, Chief Executive of recruitment body APSCo, said the pandemic was still affecting the labour market. She said that companies are finding it difficult to find permanent candidates with the right skills.

Anne Swain said: “Companies are faced with no other choice but to turn to contractors to keep business-as-usual operations running, but for many, that’s not a sustainable approach.

“With average permanent salaries…dropping despite the cost of living crisis, our economic stability is at stake. While we await the decision around a new Prime Minister for the country, my hope is that the successful individual prioritises a solution to the UK’s skills crisis.”

Miles Grady, Director of Umbrella.co.uk said: “Contractors have always played an important role in a smooth-functioning labour market. Their contribution is vital at times of economic uncertainty.

“When companies aren’t in a position to take on full-time staff, or they can’t find employees with the right skills, contractors are always happy to fill positions on a temporary basis - with very little risk to the company.

“Now more than ever it’s important that contractors get backing from the UK government, which is why it is encouraging to hear that Liz Truss has promised to review IR35 rules if she becomes the next Prime Minister.”

Speaking to The Sun on Sunday, Conservative leadership hopeful Truss proposed a new review of IR35 to reflect the fact that self-employed people don’t get paid holiday and other employment benefits.

IR35 is a set of tax rules that affects contractors that work through their own limited companies. Any contractors that are judged to be ‘inside-IR35’ are forced to pay tax like employees, but don’t enjoy the same benefits.

Miles Grady said: “Previous IR35 reviews have promised much and delivered little, so we will have to wait and see if this leads to any significant changes. But at least we can see senior politicians recognising the issue.”

For more information about IR35 and contracting through an umbrella company, speak to a member of the team today. Call: 01625 546 610.