21 Nov Contractor Trends for 2024
Much has happened over the last 12 months – we have had a coronation, a cancellation and a Covid-19 inquiry. As 2023 comes to an end and we head into a new year, we look ahead to anticipate what 2024 might bring for contractors, recruiters and end clients.
IR35 – to reform or not to reform?
One of the most eagerly-anticipated pieces of news from this year was that IR35 would be reformed. However, in a surprise move in March, the Chancellor of the Exchequer, Jeremy Hunt, reversed his predecessor’s plans to reform IR35, leading to disappointment among industry experts, contractors, recruitment agents and end-clients alike.
This came after the Government’s Call for Evidence on the umbrella market closed in 2022 and its Summary of Responses, which demonstrated the desire from within the industry for reform, was published in June 2023.
Meanwhile, almost as a compromise, HMRC has suggested that a ‘tax offset’ may be introduced which will potentially halve the tax risks of end-clients who engage PSC contractors who are outside of IR35 and are challenged in error about the levels of income tax and National Insurance contributions they are liable for. The government held a consultation on this subject and we will bring you the results for further discussion when they become available.
More contractors in 2024?
There are now over 4.24 million self-employed workers in the UK. Whilst this figure has fallen from around 5 million during the height of the Covid-19 pandemic, it still represents almost 13% of the working population of the country and there are signs that self-employment continues to be a popular option, particularly among construction workers (783,000), veterinary workers (598,000), in education (263,000), and healthcare (295,000).
Recent research from finance and business support recruiter Walters People shows that 58% of full-time employees would consider contracting in the next 12 months, with pay as the driving factor, especially among young professionals.
Interestingly enough, one of the primary reasons that workers were unsure about contracting was their perception that they would lack employment rights. As anyone who’s partnered with i4 knows, this certainly isn’t an issue, as explained here.
Recruitment Trends 2024
If we dive down into some representative contractors’ sectors, we can see the following:
Hospitality – a shortage of experienced staff continues to be a major issue for hospitality specialists leading some to speculate whether recruitment challenges in the sector can be addressed by adding it to the Government’s Shortage Occupations List to attract candidates from further afield.
Healthcare – the Care Quality Commission notes that the number of health and social care staff in England has risen over the last year, however in adult social care there are 45,000 more vacancies than in 2022, affecting capacity within the system.
Veterinary Sector – the industry is facing a recruitment shortage which in turn affects the UK’s food security, the economy, as well as our beloved pets. It’s estimated that 68% fewer vets came to the UK to work over the last 12 months, meaning that those who remain are working harder and are more under pressure.
Wellbeing at the Forefront
Collectively we’ve been through a lot over the last few years, having weathered a pandemic with the financial and emotional ramifications that it brought, so next year we expect to see an increase in the importance of employee wellbeing. It’s a vital resource in both recruitment and retention and with 88% of people saying that their wellbeing is a higher priority than their salary, many employers are now prioritising wellbeing strategies and encouraging their employees to take care of themselves as well as initiating policies that address mental and physical health.
Examples of such initiatives include:
- Four day weeks
- Flexible or remote working
- Mental health support
- Gym membership
- Fertility assistance and menopause support
- Opportunities to volunteer
- Career progression opportunities and training.
Despite the challenges next year will bring, we’ll continue to support our hard-working contractors and recruitment partners by providing them with a range of cost-effective umbrella options and payroll services, as we have since 2005. To find out more about how we can support you into 2024 and beyond simply call us on 0203 603 1290, email us at firstname.lastname@example.org or fill in the contact form here.