IT skills shortages: contract vs permanent staff

shutterstock 638186110

Permanent job opportunities are booming in the Technology sector. Given that demand for skilled staff is outstripping supply, why aren’t more employers bridging the gap with contract staff? 

When I speak to employers about the potential of utilising contract staff to supply the skills that they need, there is sometimes reluctance. The main areas of concern are: 

  • The perception that contract staff are expensive – they may not have the programme or project budget resource to accommodate contractors.
  • Concerns regarding how their existing team would feel about the addition of contractors – alternatively they may up-skill their team or outsource the work.
  • Lack of understanding of how to engage with contract staff and the potential risks.

Solutions not problems

I see myself as a solutions provider rather than a recruitment consultant – after all, I am here to resolve the skills gaps within your programme, project or team. So let’s challenge the three most common concerns. 


One advantage of a contractor is that their costs do not always come out of a hiring budget; they are frequently aligned to a programme or project budget. ARM can be flexible in the way we charge for contractors’ services, so rather than a standard daily rate, we can talk to our contractors about a base line contract rate with a delivery bonus on programme completion. This is something we regularly explore with candidates and employers, as this ensures we all work towards the same goal: getting correctly skilled people to deliver the right solution and therefore completing projects on time and within budget. 


As an employer, your team may feel threatened by the appointment of a contractor but they should feel empowered to learn from them. A part of any contractor’s time with a company will be spent working with incumbent members of the business, which gives the team a great opportunity to learn from someone outside of their business. Maybe they’ll gain knowledge of what the competition is doing, plus what and how other markets are dealing with the same issues or projects. As long as this is sensitively handled, most teams embrace the addition of contract staff. 

Skilling up the current team to deliver a programme will take time and money, and on many projects both are in short supply! The benefit of a relevantly skilled contractor is that they hit the ground running and share their expertise with the permanent team members – thus upskilling the team and delivering the programme. 


The issue of risk centres on the question: 

When does a company decide to use a consultancy or a contractor? 

I’ll often approach an employer that is running a programme, to introduce them to a contractor with the required skill set – only to be denied. I will then be asked by a consultancy to search for the same candidate, who they will place into the same client but at a higher rate. From my point of view this is rather baffling because, either way, the contractor is still performing the same job. 

I’m interested in hearing your views, so please email me with your thoughts about this.

I would recommend that, if you have never used a contractor before, you should look at the opportunities they offer. Start by speaking to a contractor to understand what they do! In essence they are consultants – they are employed to resolve your issues, be inventive and agile, and a specialist in their sector. A skills gap shouldn’t be a huge problem – rather an opportunity to widen knowledge. 

Get in touch

If you’re looking for a new contract, you can register with ARM and view our latest vacancies. Alternatively, call the ARM Information Technology team on 02036 978 434 and follow our LinkedIn page for the latest news.