Contractors within the UK are feeling under fire, as over half believe the government would rather they became permanent employees, according to new research.
The majority (60%) of contractors think the government is discouraging contractors and would prefer them to become permanent employees, whilst only 8% think the government values contractors as an important part of the workforce, revealed the research by Contracting Scout.
Contractors feel more appreciated by the business sector, with 46% thinking that they’re valued as an important part of the workforce. However, 18% still feel the business sector discourages contracting.
Will Ryles, head of recruitment at Contracting Scout, said: “It’s little wonder that contractors are feeling the government is trying to push them out of contracting. April 2016 saw new legislation come into force restricting travel and subsistence tax-relief for some umbrella or limited company workers inside IR35, as well as changes to the way dividends are taxed.
“The Autumn Statement is expected to reveal further details of the proposed changes to IR35 in the public sector. Contractors have enough to deal with without constant tax changes. There seems little appreciation for the fact that contractors provide flexibility and specialist skills that businesses and the public sector would not otherwise be able to access.”
Just over a quarter (26%) of contractors believe the UK leaving the EU will make it more difficult to get work, but 11% think it will make it easier for them to get work. Thirty-seven per cent don’t think it will make any difference to them and a little over a quarter (26%) don’t know what effect it will have.
Mr Ryles added: “Despite the mood of economic uncertainty in the UK, 44 per cent of contractors in our survey still plan to increase the rates they charge over the next 12 months. Forty-eight per cent will leave their rates as unchanged but seven per cent plan to reduce what they charge. This resilient part of the workforce is very much focused on just getting on with the job for their clients.”
When it comes to looking for their next role, the most popular route for contractors is to use a recruiter, with 40% opting for this. Thirty per cent choose to use jobs boards and just over a quarter (26%) rely on their own network of contacts.
Ryles said: “Recruiters remain an ever popular way for contractors to find their next role and this is what recruiters should be concentrating on as that’s where they add value and generate their fees. However, if the proposed changes to the intermediaries legislation in the public sector go through in the current form, recruiters, along with the public sector body and other third parties paying the contractor, will bear responsibility for ensuring the contractor does not fall under IR35.
“It doesn’t make sense for the government to impose strict legislation on the people who can play a significant role in helping contractors drive economic growth in the UK.”