IT contractors flee Canberra, cause skills drought

A sharp decrease in the number of government IT contracts has resulted in a new skills shortage as contractors leave Canberra in their droves, according to a new study.

Research from recruitment firm Peoplebank shows that due to government departments using contractors less frequently, a skills shortage has now hit Canberra.

Peoplebank’s Labour Hire Index has fallen from 2251 points in 2006 to 1175 in 2009 and government contracts have decreased by 20 to 25 per cent over the past 12 months.

This comes despite a forecast that indicates a strong increase in demand will occur in the near future.

Acting CEO of Peoplebank, Jeff Knowles, sees this trend as something that could increase the cost of future contracts.

“It’s a volatile market: the downward trend of recent years is likely to be replaced, quite rapidly, by an upward trend in both demand and rates,” Knowles said.

“This will intensify the upward pressure on contract rates – with the result that departments will face higher costs or risk being unable to secure the ICT skills they need to achieve their business goals.”

The study is based on data from AusTender and tracks information on employees in the industry through a contracting management system.

Peoplebank has found skills are needed in the areas of SharePoint, .NET and Java development, project management and business analysis.

Hourly rates for consultant have increased across the board with the rate of pay for a senior .NET developer rising from $90 per hour in 2009 to $110 per hour in April.