An Upturn in the Testing Market?

The end of January saw the UK economy grow for the first time in six quarters, signalling what is being dubbed the end of the recession. The question on my minds is how will this affect the testing market specifically? Has the dawn of 2010 brought a new lease of life into the testing market?

Here at Sanderson, we have seen a dramatic increase in the amount of demand for testing contract resource. The growth of IT contracting positions has grown as a result of the recession and not in spite of it. There is a need for highly skilled professionals, who will not require in depth training, nor the overheads associated with permanent staff, so the obvious solution is to outsource IT development and business analyst roles to independent IT contractors.

This is fantastic news but it also creates a few important questions to consider. Do you think this upturn in the market is just a temporary one or have we seen the last of the recession within the IT/Testing market? My personal view is that there is every reason to be positive, however, we should proceed with caution. 12 months ago, companies were either cancelling projects or asking the contractors to take rate cuts anywhere between five and 20%. A year has passed and now I am having very different conversations with contractors. Buoyed by increased resurgence in demand, many are now asking for rate increase upon extensions or higher rates when applying for new opportunities.

I think this uncertain period should be a time for consolidation. If a contractor’s role has changed to take on more responsibility then I agree that individual should be compensated for this. However, it is my belief that right now is not the best time to try and claw back all the money you lost in 2009. Here at Sanderson it is benefit us as a business if we get higher rates for our contractors because we profit from the margin on top. However, in a market where the global financial crisis is a not so distant memory, we need to look at the bigger picture. To continue to have success in 2010, 2011 and beyond we should be playing the ‘long game’.