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IT contractors face tough times Down Under

Contractors have experienced about a 10-15 percent drop in their rates in Australia, with a drop of up to 30 percent in extreme cases
Written by Vivienne Fisher, Contributor

The changing economic climate is taking its toll on Australian IT contractors, as they struggle to pull in the same dollars they were 18 months ago.

Justyn Griffin, a manager at recruitment consultancy Julia Ross IT, says many contractors have opted to go travelling, or are taking a break due to declining salaries.

He uses the example of a UNIX administrator he knows who spent the past four years working as a contractor and has recently decided to work in his wife's coffee shop rather than take a salary cut.

Griffin also believes that a number of contractors have used the lull in the market to spend time travelling, although he warns that the market is no more buoyant in the US or UK for Australians hoping to pick up contracting work abroad.

He estimates that across the board there has been about a 10-15 percent drop in the rates contractors are commanding in Australia. However, in more extreme cases Griffin has seen a drop of up to 30 percent in some job areas.

IT contractors are also flowing back into Australia from overseas, as contracts dry up in other countries. According to Griffin, expats are returning from regions like the US and UK, rather than Asia where contracts tend to run for longer periods of time.

"They're having to do more legwork to get the role and there's more competition between jobs," Griffin said. He cites an ad he put on an IT job site in early December for a helpdesk role -- within 24 hours it had elicited more than 140 responses.

Derek Chan, chief technology officer at imaging and document compression software developers Realview Technologies, has seen peers struggle to gain the same rates contracting that they previously had. He said the rates some contractors are achieving now are down about AU$25 (£9) an hour from little over a year ago.

"People are being very specific about the skills they want - because it's an employer's market they can afford to be much pickier and pay less," Chan said.

Likewise, Robert Walters Dunhill director Joshua Sparks has seen the laws of supply and demand impact the rates IT contractors are getting.

Areas which he has seen rates remain static, due to a high demand for these skill sets, are network integrators, security consultants, and senior technical architects. In contrast, Sparks has seen a greater drop in rates for job titles including helpdesk and support, infrastructure consultants, and object-orientated developers.

Felicity Loe, an account manager with recruitment consultancy IT&T Careers, agrees there has definitely been a drop in the rates contractors are securing.

"That points back to the fact that most organisations aren't spending money on new IT projects, so there's not much of a need (for contractors)," Loe said. "When it comes down to it, when the times get tough you're only worth as much as someone's prepared to pay for what you can do."

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