Myth vs Fact: Career as an IT Contractor

The UK is now home to 1.4million freelancers, with the most popular profession on the list being IT and Engineering. The unprecedented events of Covid-19 have seen some tech specialists consider swapping a permanent position for the flexibility, autonomy, variety of work and better work/life balance of a contracting career. However, industry gossip or uncertainty over legal and finance questions could be deterring some skilled individuals from further exploring a contracting role.

Generate’s payroll and contractor management specialists reveal insights from our IT contractors about what it’s really like to work as a tech professional.

3 Secrets of Tech Contracting Career Paths

1. Myth One: It’s Hard to Find a Job.

Reality: Most industries are in urgent need of tech specialists, both contract and permanent.

IT and technical specialists are included on the Government’s Official Shortage Occupations List in the UK and many other European countries. Gartner reports that 75% of businesses across industries are already experiencing a gap between tech skills needed and those they are able to recruit. The skills gap means business leaders are increasingly recognising the importance of IT departments to business continuity and growth, and companies are increasingly open to short- and long-term contracts for a variety of roles.

The tech areas with the largest skills gaps, and therefore presenting some of the best job opportunities for the next few years, include:

Software Development – Emerging technology such as automation and Artificial Intelligence (AI) are driving demand for software developer skills much faster than these skills can be created. McKinsey predicts that the world’s industries will require up to 50million more Software Developers by 2030.
Cyber Security – Only 10% of IT professionals have the cyber security skills the UK’s tech sector currently needs. Demand for cyber workers with Amazon Web Services (AWS) skills has increased by 62% since 2019, but cyber security professionals with these skills only make up 3% of the talent pool.
Cloud – 86% of IT leaders believe that a shortage of cloud talent will slow down existing and future cloud projects. Companies are particularly short on Azure experience: 80% of Cloud developers have trained on AWS, meaning only 35% of Cloud specialists have experience with Azure.
Emerging Technologies – 66% of IT leaders report a lack of sufficient skills in AI, 62% in the Internet of Things (IoT), 61% in Augmented Reality (AR) and Virtual Reality (VR) and 60% in Robotics.

Hundreds of tech recruitment agencies exist in the UK alone, with most experienced in finding jobs for contractors, and many even specialising only in IT contract recruitment. These recruitment specialists will possess years of expertise finding jobs for thousands of IT professionals across field type, location and industry, and especially due to the IT skills shortage, will be able to help you find your first contract assignment and support you throughout your contracting career.

2. Myth Two: It’s Lonely.

Reality: It’s what you make of it.

Those who have spent years working at one place, enjoying banter and collaborative working relationships within a close team and a supportive relationship with their boss, may believe temporary working can’t compete with the social aspect of a permanent role. However, solo doesn’t have to mean solitary.

By nature of their roles, sole traders will speak to a variety of different people all the time, to discuss projects, solve problems, collaborate with suppliers and organise solution delivery and admin. Tech contractors are often in management positions where they lead and interact with a team every day. Temporary project specialists will work with a wider variety of departments and people than many other tech colleagues, and will communicate and brainstorm constantly to hit deadlines and delivery requirements. As contractors usually work on time-critical projects, programmes and product launches, regular teamwork is vital to meeting client milestones and targets – the high levels of collaboration required create strong social bonds between all individuals involved, both permanent and temporary.

Bouncing around ideas, sharing knowledge and deriving motivation from someone outside yourself can all be more difficult, but they can be much more accessible with the right planning and efforts. A wealth of digital and physical spaces exists to provide tech specialists with lifelong personal and professional connections. Contract professionals often find support and career development through joining online communities like Reddit or Stack Overflow, attending industry events and webinars, networking online and in person, and building strong relationships with former colleagues throughout their careers.

The autonomy and flexibility given by temporary employment can even help individuals become more sociable. From a real work/life balance to more chances to catch up with family and friends: choosing to spend your time with the people who matter the most to you and carving out the social life you really want.

3. Myth Three: With All the Admin and Responsibility, It’s Not Worth It

Reality: Help is Always Just Around the Corner.

Whilst being your own boss provides great freedom, self-employment also comes with great responsibility. Contractors are liable for their own tax returns and must take ownership of their finances and working practices to comply with strict laws. The extension of IR35 tax legislation across the private sector has caused further frustration and anxiety amongst temporary workers. IR35 status determination depends on dozens of factors, from your relationship with your end client to the tools you use in your everyday job, and can be difficult to understand; the UK Government’s own purpose-built determination tool delivers incorrect results for 1 in every 7 people.

With extensive court cases and large fines for non-compliance with tax laws, members of the permanent workforce may look upon contracting as admin-heavy, financially worrying and an organisational nightmare – but this doesn’t have to be the case. Contracting is often much simpler and more rewarding than those outside of the industry expect.

Contractors who want help with their admin and support with the legal aspects of their job can sign up to an umbrella or contractor management provider. One benefits of this option is the possibility of joining the umbrella’s payroll, relieving the contractor of most IR35 status determination and legal liability, reducing workload with all taxes and deductions organised and paid on their behalf. This option could also provide the same working rights and benefits as enjoyed by a permanent worker, and depending on your provider, a comprehensive insurance policy and guaranteed payment schedule can provide the same level of job security.

Getting the support of a contractor management company with an on-site compliance team can prove the difference between significant legal worries and a stress-free contracting career.