How could a second wave of COVID-19 impact on contractors?
The latest research for Qdos has revealed that the first UK lockdown saw up to 46% of contractors have their projects postponed or terminated early. For many limited company contractors, this meant a significant reduction in income and the start of a summer of financial stress.
While government support schemes have provided financial aid for some, the research has found that around one third of self-employed people have not received any help. This includes millions of sole directors of limited companies and many who have only just registered as self-employed.
Thankfully there appears to be a light at the end of the tunnel, according to the latest Report on Jobs by KPMG and the Recruitment and Employment Confederation (REC). As parts of the economy began to reopen in September, contractor hiring levels significantly increased. In fact, hiring for temporary jobs rose at a faster rate than last month and at the fastest rate since the end of 2018. According to the data, this increase in hiring is likely to be the result of projects restarting following the easing of lockdown measures.
It’s all about the money
Within the private sector, the increase in hiring has been steadily growing, while in the public sector it has only just started to accelerate. This has come as a relief to contractors exclusively tied in to public sector work. In terms of regions, London was the only area that saw a decline in the number of jobs available. Meanwhile, the midlands recorded the fastest rate, followed closely behind by the north of England.
However, the increased demand hasn’t translated to increased rates. This is particularly true where smaller firms are concerned, as many are tightening purse strings in preparation for the uncertain economic future created by the pandemic.
In light of this, contractors are being encouraged to take advantage of every job opportunity as they plan for an uncertain future.
The challenge of a second wave
Now that the second wave of the pandemic is underway and a new lockdown is due to begin, it’s expected that businesses will once again put many of their projects on hold.
According to James Steward, Vice Chair at KPMG, the challenges facing contractors in the coming months look set to prevent the start of financial recovery for many self-employed.
“With increasing unease over what will happen in the coming months with the pandemic, Brexit and with the end of the furlough scheme in sight, the uncertainty for UK business is not going to dissipate anytime soon.
“The Government has got challenging times ahead to continue to offer adequate support to business, opportunities for job seekers to upskill while helping instil confidence in the UK workforce.”
Author: Steven English
03.11.2020
