IT Contractors are hired when companies are looking to fill a short term gap in their IT expertise, or as part of a general strategy to outsource technical work. This article looks at what factors influence how much IT Contractors can earn.
As the term implies, IT Contractors are contracted to work for companies for a fixed period of time. As a general rule, they significantly more than permanent employees performing similar roles.
Many IT people value the freedom and choice that contracting offers, as well as the financial benefits. There are some disadvantages such as putting up with the uncertainty of finding new IT contract roles, and weathering economic downturns, but overall you will rarely find an IT contractor who regrets leaving permanent employment.
IT Contract Rates
IT contract rates vary a great deal, according to a number of factors:
The most influential factor in working out what contract rate you may expect. Some niche skills can attract rates in excess of £100 per hour, whereas less in-demand skills (such as general web design skills) will attract much lower rates. The average contract rate is around £40 per hour according to Jobstats (below).
The length of time you have practiced your skills is obviously an important factor. Despite many IT Contractor stereotypes, business experience is also very important. Some roles may be purely technical, but general business experience cannot be overlooked.
The City and London in general always attract the highest contract rates, followed by the South-East.
The state of the general economy usually has a significant effect on demand for contractors. Following the dot-com bust, and another smaller downturn in 2003-5, the contracting market has been in a very healthy state ever since. Anecdotal evidence suggests that the “credit crunch” of 2008 has yet to make a serious impact on demand for IT Contractors, although some of the major banks are reported to have slashed contractor rates.
You can usually get a general idea of the average rates in your sector by talking with recruitment agencies. There are also a number of useful online resources to help you establish what contract rate you can command.