Unemployment and employment rates are a key measure in assessing the position of any economy. Statistics of this kind are passed around on a monthly, quarterly and annual basis to share good news or tales of woe. Luckily the tale of 2012 was a more positive one for any contractor limited company.
Last year there were many positive movements in the UK Labour Market with employment numbers moving in the right direction. For the typical contractor this was fantastic news, and enabled them to focus on other pertinent matters such as how to avoid IR35 concerns and Umbrella Company vs. limited company. We have looked at some published figures for the last quarter of 2012 and they make for positive reading.
According to a recent report from the Recruitment and Employment Confederation and KPMG, contractors are still in great demand from figures rising throughout 2012.
This rise in demand for temporary workers spanned throughout engineering, construction and IT contractors, which came third and fifth in the contractor demand league table, showing that the increase in contracts surpassed the usual business sectors.
The Recruitment and Employment Confederation chief executive, Kevin Green, described the importance of such a clear rise in contracting positions. He commented, "It's another milestone for the UK labour market, which hasn't seen a full quarter of simultaneous increases in both temp. and permanent job placements since mid-2011.
"It's also further confirmation of the continued strength of our flexible labour market in keeping people in employment. The picture for 2013 is likely to be similar to 2012, and we expect the labour market to yet again outperform the sluggish economic growth in the UK."
Limited company contractors have had much attention throughout the last year with their professional tax status being the subject of media and government attention. With the clear rise in job contracts for PSC workers, an insight into the mind-set of employers is visible, with new reliance being placed in temporary workers.
"Employers are confident in their own businesses, if not the economy as a whole, and know they have to retain or recruit talent in order to have a competitive advantage."
With an influx in contractors due for 2013, the importance of contractor finance cannot be ignored, and keeping up with payments and avoiding penalties and fines becomes ever more necessary. When it comes to alternative finance and economic initiatives, contractors often do not have the luxury of specifically designed schemes, making their finances important to secure.
The recent information provided by the Recruitment and Employment Confederation highlights the fact that contracting is becoming an increasingly popular and active profession. This is obviously positive for contractor service providers, and even more so for the actual limited company professionals themselves, with a rise in contracts and an increase in jobs.
As company owners however, anyone new to contracting should be extra vigilant of the potential pitfalls that the profession can incur, and sustaining a good financial record is a way in which to maintain this vigilance.