Falling market? Sell yourself up
On the other hand, if you are a contractor, you may not be so filled with joy. While even at these reduced rates it's still possible to earn a decent living as a contractor, no-one likes less money coming in at the end of the month. So it's heartening to see that it's still possible to get some quite respectable wads of cash contracting. While some of your earning power has to do with where you live -- London and the South-East unsurprisingly have higher average rates than the rest of the country -- it's not all about being near the capital. You can increase your income if you have the right skills. ERP consultants in general, and SAP consultants in particular, can command hourly rates heading into triple figures.
The lesson from this is that to get the best rates you need to be as flexible as possible: follow the money. However, you can only do this if you're able to acquire new skills in a relatively short period. You'll need a solid grounding in the basic principles of computing and programming. It's no good knowing a single language or application any more. It's not even just about knowing the technology either -- some grounding in business processes and management will do you no harm, especially if you're chasing after that lucrative ERP job.
During the boom years of the late '90s there was such demand for people with any IT skills you didn't need a broad skill base -- it was a seller's market. Things are different now, and even though IT is getting central to more and more types of business, organisations are being extremely cautious about what they spend their money on. You need to make yourself as saleable as possible in this buyer's market. Get yourself the widest skill set you can, and get as much training -- academic and vocational, theoretical and practical -- as you can. Your future lies in your own hands.