IT Contractors Direct – Why do Clients not take more of them?

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Direct Contracting for IT Contractors
Direct Contracting for IT Contractors

Should Clients take more IT Contractors Direct?

IT Contractors Direct

According to a new survey by e-skills only 12% of ICT staff got work by applying directly to employers or clients.

That compares with an average for other professions of 20%.

In other words the norm is for one-in-five to get work directly but in our profession it is less than one-in-eight.

So, why do clients not take more IT Contractors Direct?

Why So Few IT Contractors Direct?

As IT departments are usually only one of a number of departments at a company where, presumably, the bosses of other departments are taking one-in-five direct why do the heads of IT departments hire so many fewer this way?

Why do IT agencies hold such sway with IT bosses (or Human Resources) than they do with bosses of other departments?

I‘m not sure whether the number of contractors changes the figures.

In fact I don‘t know whether if contractors were taken out that the percentage go up or down.

Not Direct

Despite what some people say I would suspect that less than one-in-five contracts are where clients take on IT Contractors direct.

I‘m trying to think if I ever got a direct contract in all the time I worked as a contractor.

I was given tip offs about contracts but I still had to go through the agency – which was a shocking waste of money as the agency didn‘t find me and did nothing for me afterwards.

I think that there was maybe one contract where I went direct.

Wasting Money

So, why do clients waste so much money in paying agencies even when the agency hasn‘t even found the contractor? Why don’t they take IT Contractors Direct?

Any time I asked clients they usually said something like ‘it‘s because you have come-back when you go through an agency’.

When questioned further they said that if someone is no good or lets you down the agency will supply someone else.

As would several hundred other agencies, I thought.

Contract Tip Off

I remember one place where I actually gave the tip-off to a few contractors about opportunities and they got the contracts.

But they still had to go through the agency.

In the US, where they network better (and clients aren‘t so stupid, frankly) around 50% of contracts are where companies get IT Contractors direct.

Calculate Cost

A shocking amount of money must be wasted in the UK on agencies who know very little about the product they are selling and who do so little for the contractor or client.

Do the maths.

There are about 275,000 IT Contractors in the UK.

They‘re probably earning about an average of £80,000 a year taking into account down time.

Let‘s say that agencies add 15% onto that on average.

That‘s an astonishing amount of money.

Now divide that by half.

You have to do that as in the US half of the contracts are got through agencies.

Final Sum

With the final sum we can see how much clients waste a year through sheer dumbness.

I make the money wasted on IT agencies at £1,650,000,000 a year – unless I‘ve miscalculated.

That‘s a shocking billion and two-thirds a year unnecessarily spent on people who add very little, don‘t know what they are selling and hardly do anything after they make the sale till renewal time comes up.

Agency Junkies

They don‘t even find the contractors or have them on their books nowadays.

The Job Boards do that for them.

Perhaps the PCG should run Client Education Classes.

Or they should be encouraged to join Agency Junkies Anonymous to wean them off the habit.

There really should be more clients taking IT Contractors direct.

It must be something in the British psyche where thy would rather pay lots more money to deal with an organisation than an individual.

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