Canberra beckons as cash cow for Australia’s IT contractors

How the Federal Government’s big budget IT projects are making Canberra a cash cow for Australia’s IT contractors

Canberra is emerging as a major drawcard for Australia’s IT contractors, as the Federal Government pumps ever-increasing budgets into big IT projects.

New research from recruitment agency, Hays, shows that the country’s capital sees IT contractors demand some of the highest pay rates in the country, with program managers working in Canberra able to make up to $1,800 per day – the highest rate in Hays’ findings.

By contrast, contract program managers working in Sydney, Melbourne or Brisbane generally charge rates of up to $1,700 per day, while those in Adelaide, Perth and Darwin top out at around $1,400-$1,500.

The same trend can be seen across the spectrum of specialties within the IT contractor landscape, with Canberra consistently seeing higher rates of pay than other capital cities, according to Hays’ IT Contractors A Driving Force in the Digital Economy: 2017 IT Contracting Recruitment & Rates Guide.

While Hays surveyed a relatively small sample of 240 IT contractors to inform the report, the results clearly point to Canberra topping the nation in terms of demand and pay.

“In the Australian Capital Territory [ACT], the recruitment market is linked to the federal government contracting cycle and the financial year,” Hays said in the report. “A key driver for the Canberra market is the federal government’s drive to improve services by decreasing complexity and increasing online accessibility.

“Led by the Digital Transformation Agency [DTA], many departments are initiating significant change and much of their operational budget is being directed to achieve set goals,” it said.

Indeed, the Federal Government’s latest annual Budget, handed down on 9 May, revealed hundreds of millions of dollars that have been allocated to long-term, far-reaching IT projects.

The Government announced it would provide $374.2 million over two years from 2017-18, including $94 million in capital, to continue its My Health Record system, while also forking out $67.3 million in 2017-18 for the overhaul of its health and aged care payments IT system.

Likewise, the Government said it would dish out an undisclosed sum to improve the security and resilience of the Bureau of Meteorology’s IT systems and business processes, and $313.5 million funding over four years from 2016-17 for its Welfare Payment Infrastructure Transformation (WPIT) program.

According to Hays, there will be a big rush for resources to meet project delivery milestones at the end of the financial year. This is expected to be followed by a giant spike as the market adjusts to budget allocations and project confirmation at the start of the new financial year.

In the private sector, hays said that it’s also seeing increased contract demand thanks to IT budgets expanding to match project scopes.

In terms of skills in demand, Dynamics CRM Developers, .Net Web Developers, Solutions and Technical Architects top hiring managers’ lists.

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On an ongoing basis, general turnover will lead to continuing contract roles, the recruitment agency said.

What keeps IT contractors on the move?

According to Hays’ research, the top benefit of IT contracting, according to survey respondents, is the increased earning potential offered, with 75 per cent citing this as a major draw.

Also at the top of the list is flexibility, with 67 per cent of respondents nominated this as a major benefit, experience, making new contacts and skills development.

“Anecdotal feedback echoes these findings with one respondent summing contracting up as ‘a license to practice anywhere’,” Hays said.

When choosing what projects to work on next, 78 per cent of respondents said that pay rate is a top priority. This was closely followed by the quality of the project or work, flagged by 74 per cent of respondents.

Also important is the length of the contract, the ability to extend skills and the reputation of the employer or organisation.

Good times ahead, with change

The Hays research comes as Clicks IT Recruitment publishes its second quarter findings from its quarterly IT Employment Confidence Index, with the latest results indicated a high level of positive sentiment towards the Australian economy and the future of their employers.

This has been a continuing trend over the last 12 months, according to Hays.

While confidence in the local market remains stable with little variance, individuals’ self-perceived employment prospects and plans for the future are changing.

52 per cent of respondents indicated that they were likely to be looking for a new job in the next 12 months. This is up from 45 per cent in the last quarter.

Additionally, a record low of 14 per cent of respondents indicated that they felt negatively about their ability to secure a new job.

Clicks said that, over the past few months, its consultants have casually observed a high demand amongst employers for certain IT roles.

“These results indicate that IT staff may be catching on to the increased demand and starting to think about career moves,” the company said.