Views & Opinions

What The Clients Say

“Quick hire, make long term decisions based on performance, no long-term commitment on either side, and flexible resourcing.”
Quote from Respondent

In 2024, 72% of client companies are multi-nationals with 27% domestic. 53% of client companies have over 500 employees, and 17% of client companies have less than 50 employees. 37% of companies engage between 1-30 contractors at any one time, and 28% of companies engage 200 or more contractors at any one time. This highlights that fact that whether the company is large or small, domestic, or multi-national, there is demand for contractors in the Irish labour market. Client companies understand the huge value professional contractors bring to their organisations. Contractors allow organisations progress projects quickly, gives clients access to sought after skills when necessary, and keeps companies agile and responsive to both project needs and market conditions. 82% of contractors in client companies are professionals (e.g., IT specialists, engineers, accountants, analysts, doctors etc).

Organisations utilising contractors in their labour model can hire in skills when they are needed and once the contract is finished the overhead is gone. This ultimately reduces unnecessary labour costs. 81% of companies participating in the 2024 survey operate in the private sector. The 2024 survey results show companies engaging contractors are engaged in a wide range of industries, Pharma is the largest sector at 20%, other strong sectors include Engineering and Technical Activities, Life Sciences, Med Devices, ICT and finance. 41% of companies expect their contractor numbers to remain the same as 2023 and 48% of companies expect their contractor numbers to increase.

Clients Industry Profile

The results of the 2024 survey show companies engaging contractors are evidenced across a wide range of industries with Pharma the largest industry represented this year at 20%. Engineering and Technical Activities (18%), Life Sciences (16%), Med Devices (9%), ICT (8%) and finance (7%).

Why Companies Use Recruitment Agencies

38% of companies use recruitment companies to hire contractors, 19% recruit directly, 6% are referrals and 37% of companies use a combination of all three method to engage contractors initially.

45% of companies engage recruitment companies for their contract hiring to reduce payroll/ direct hire costs, 37% use agencies to improve the quality of their contract hires, this is up from 5% in the 2023 report. 32% use agencies to access recruitment expertise not available in-house.

The Biggest Concerns Or Barriers To Engaging Contractors

The biggest concerns to engaging contractors are cost and compliance issues. 56% of client companies cited cost as their biggest concern. Compliance concerns began following legislative changes in the UK, namely IR35. No changes were introduced in the Irish market, but it did heighten companies’ awareness as to their potential responsibilities to contractors. 52% of companies reported concerns around the tax implications if contractors are not set up correctly down from 64% in 2023. The drop in concern may indicate that the Irish market does not anticipate the Irish government will introduce legislation similar to IR35. Other concerns included contractors right to work and other HR issues (49%). There has been an increase in the number of companies who were concerned about the impact on the erosion of staff morale by engaging with contractors. This has increased from 26% in 2023 to 38% in 2024.

Criteria Driving Demand For Contract Roles

In 2024 75% of respondents stated the main criteria driving demand for contractors was to enable the company to be more agile. 66% agreed that engaging contractors gave them access to skills not available in-house. 63% agreed that a tight skills market was driving demand. Other factors driving demand included candidates chosen way to work, suggestion by the agency, changes in hiring practices, market growth, freezing hires, and innovation.

Future Expectations

Client companies remain positive in their short-term outlook, 56% expect the performance of the Irish economy will increase over the next 12 months. 63% of respondents expect the number of contract roles in the next 12 months to increase. It’s evident that companies are significantly more positive than this time last year when just 36% expected the performance of the Irish economy to increase and 37% expected the number of contract roles to increase.

Confidence Index

There has been a significant increase in the confidence index scores of client organisations relating to both the performance of the Irish economy in 2024 and the number of contract roles that will be available. The performance of the economy has increased from -5 in 2023 to +27 in 2024. The confidence index score for the contracting sector has increased from +8 in 2023, to +28 in 2024.

What the Clients Say...

“When the market slows down cost is always the first thing that is looked at, and as such, permanent headcounts decrease. Contractors offer a great interim solution in these instances.”
“The number of contractors hired relative to the number of full-time employees can affect the company culture. The location of the contractors, particularly if they are remote, can impact the company both negatively and positively. Negatively, in terms of having loyalty to the organisation. Positively, in bringing skills to the organisation. Contactors can bring a skillset which can be applied to specific projects, without taking on the cost of a fulltime employee.”
“The loyalty of some contractors to the business they are suppling their services to can be very transactional at times, this can then tarnish the reputation of other contractors.”
“Just because an individual is employed as a contractor, does not mean they are completely self-sufficient and can be ignored. If viewed & managed correctly they can be extremely beneficial. The organisation's level of understanding of the work, subject matter, and expertise of the contractor is important to help this.”
“Hiring contractors helps clients with cost saving, achieving set goals quicker, acquiring skills more easily, and increasing professional social circles dramatically.”
“Apart from the performance and cost benefit of employing contractors, they may not have any loyalty to the organisation and consequently not contributing positively to the culture or knowledge base of the organisation.”
“I have joined a small company from a Global Multinational, and I am trying to introduce how using contracting work helps to grow quickly and support the needs of the business.”
“Make them feel appreciated and part of your group. The 'them' and 'us' approach is a sure-fire way to fail. Everyone likes to feel accepted; empowerment is key. The more the buy in, the better the results.”
“Make it easier from a reporting and taxation perspective to operate as a contractor. The contractor community form an integral part of businesses' recruitment and talent strategies.”
“Ensure that Irish laws are clear and updated to address the rights and obligations of independent workers. Regularly review and adapt regulations to the evolving nature of work in the gig economy.”
“Government needs to define what a contract worker is and cement their rights.”
“Make them feel appreciated and part of your group. Them and us approach is a sure fire way to fail. Everyone likes to feel accepted, empowerment is key. The more the buy in, the better the results.”
“Client organisations can be hit or miss in terms of how contractors are treated; some organisations basically treat them the same as permanent employees while other organisations don't include them in social events, Xmas parties etc. Being more inclusive benefits everyone”
“Apart from the performance and cost benefit of employing contractors, they may not have any loyalty to the organization and consequently not contributing positively to the culture or knowledge base of the organization.”
“Govt. should set up a body to nurture, standardize, and provide clear guidelines for the contracting market in Ireland.”
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  • Acknowledgements

Understanding the Confidence Index

Throughout this report you will see reference made to the ‘Confidence Index.’ The confidence the participants have in several areas was expressed through the way they answered a number of key questions almost identical in nature but presented in different ways. The average weighting of these answers is then used to calculate the confidence index. A confidence index of zero would indicate that there was a totally neutral feeling by the respondents. A positive figure represents a positive outlook, with the scale maxing at 100, while a negative score indicates the feeling of unfavourable negative feelings towards the economic or business future.