Views & Opinions

What The Clients Say

“There should be a clear and transparent metric on the pay and benefits between contractors and employees”
Quote from Respondent

74% of client companies participating in the survey this year were multinationals and 16% were domestic Irish companies.

9% of companies had between 11 and 50 employees down from 16% last year, with 66% of companies involved in the survey having 500 employees or more.

In 2026, 30% of companies engage more than 200 contractors at any one time, confirming the central role of contractors in workforce delivery for larger organisations. 11% of client respondents engage fewer than 10 contractors and 16% engaging between 11 and 30. 5% engage 31–50 contractors, 6% engage 51–100, and 8% engage between 100 and 200. 24% of respondents were unsure of their current contractor numbers.

Looking ahead, expectations for the next 12 months suggest overall stability with a growth bias. 60% of organisations expect contractor numbers to stay within 10% of current levels, indicating steady demand. At the same time, 26% anticipate growth, with 20% expecting an increase of more than 10% and 6% forecasting growth above 20%. In contrast, 14% expect a contraction, split between 11% anticipating a decrease of 10% or more and 3% expecting a reduction of 20% or more. The outlook points to continued reliance on contractors in 2026.

22% of companies had between 11 and 50 employees up from 17% in 2024.

Clients Industry Profile

In 2026, contracting activity is more concentrated, with Pharma dominant at 37%, up from 30% in 2025. This points to sustained demand for specialist skills in regulated and knowledge-intensive environments. ICT accounts for 10% in 2026, down from 13% in 2025. Engineering and technical activities remain stable at 12%.

Medical Device contracting stands at 10%, down from 12% in 2025, while Life Sciences has declined to 7%. Finance has also reduced to 7%, from 9% in 2025, reflecting a more cautious approach to external resourcing. Medical Locum roles remain limited at 2%, while Marketing and creative industries have increased to 3%, up from minimal levels in 2025. The ‘Other’ category has contracted to 12%, down from 16%, reinforcing the shift towards more established core sectors, led by Pharma. 100% of client company respondents were in the private sector.

44% of companies expect to engage the same number of contractors this year as last, with 46% expecting the numbers of contractors they will engage to increase in the next 12 months.

Engaging Contractors

Contractors in 2026 continue to be engaged predominantly in high-skill roles. Professionals, (SOC2) remain the largest group at 73%, down from 77% in 2025. Engagement of Managers, directors and senior officials, (SOC1) has reduced to 13%, from 20% in 2025, suggesting more selective use of senior contractors. Associate professionals and technicians, (SOC3) account for 23%, compared with 30% in 2025, while administrative and secretarial roles remain relatively stable at 14%. Sales and customer service roles are unchanged at 8%, indicating consistent but limited contractor use in customer-facing functions.

Contractor Recruitment

In 2026, companies show a stronger reliance on external recruitment agencies, with 56% using third-party providers, up from 37% in 2025. Direct recruitment has also increased, rising to 31% in 2026 from 25% in 2025, suggesting improved internal hiring capability. Referrals from existing contractors account for 7%, slightly higher than the 6% reported in 2025, reinforcing the value of trusted networks. In contrast, the use of a mix of recruitment approaches has fallen sharply to 5%, down from 32% in 2025, indicating a move towards more focused recruitment strategies.

Why Companies Use Recruitment Agencies

In 2026, the reasons clients use recruitment companies have changed, highlighting amore measured and selective use of external recruiters. Reducing time to hire remains the top driver at 24%, although this represents a significant fall from 46% in 2025, suggesting some improvement in internal hiring processes or more predictable contractor demand. Reducing payroll and direct hire costs accounts for 20%, down from 35% in 2025, indicating that cost pressure remains relevant but is no longer the dominant motivator it was previously.

Other drivers, accessing recruitment expertise not available internally has fallen to 16%, from 32% in 2025, while improving the quality of contract hires has reduced to 11%, down from 32%. The increases seen in recent years around risk reduction has eased in 2026, with 14% citing this reason, compared with 35% in 2025, suggesting either greater confidence in contractor engagement or improved compliance frameworks. Finally, improving the candidate and hiring manager experience is cited by 6%, down from 16% in 2025, reinforcing the overall trend towards more targeted use of recruitment partners.

The Biggest Concerns Or Barriers To Engaging Contractors

In 2026, companies continue to report multiple barriers when engaging contractors, with cost remaining the single biggest concern. 57% agree that cost is a barrier, up from 58% in 2025. Concerns about the unknown have increased, with 56% agreeing in 2026, up from 52% in 2025, signalling ongoing uncertainty around how contractor engagements may evolve over time. Tax implications remain a major risk, with 49% agreement, reinforcing anxiety around compliance and potential penalties if contractors are not set up correctly. Several risk-related concerns have intensified.

Contractors’ right to work now concerns 48% of organisations, while other HR implications concern 44%, showing that education around employment status, and documentation still need to be addressed. Potential disguised employment has risen to 44%, up from 39% in 2025, indicating growing awareness of regulatory exposure. Erosion of staff morale has also increased, with 37% agreement, compared with 31% previously, suggesting greater sensitivity to the impact contractors may have on permanent teams. While cost remains the biggest barrier, risk, compliance and uncertainty have become more prominent in 2026.

Additional barriers to engaging contractors

So, while cost remains a major barrier, the real friction points lie in uncertainty, compliance complexity, communication gaps and inconsistent treatment. Many of these barriers are viewed as solvable through clearer rules, better education, stronger processes and more inclusive engagement practices. Analysis of open-ended responses highlights additional barriers but also provides more insight into the main barriers and concerns that exist when engaging contractors:

  1. Lack of clarity and transparency: Particularly around tax rules, employment status and compliance. Many reference fear of fines, audits and disguised employment, pointing to a need for stronger government guidance and clearer legislation.
  2. Communication and engagement: Respondents highlight gaps between contractors, employees, managers and head office. Calls for more dialogue, honest managers, regular feedback and better internal communication are common, lack of clarity is leading to morale erosion.
  3. Contract structure and stability: Many respondents request longer-term contracts, rolling agreements, clearer scope definition and better visibility on rates and contract length. Short or uncertain contracts are seen as a driver of churn, disengagement and delivery risk.
  4. Fairness and parity: Respondents frequently mention unequal treatment between contractors and permanent staff. This includes disparities in benefits, workload, job quality and recognition.
  5. Process improvement and professionalism: Suggestions include dedicated HR support, stronger recruitment processes, better candidate matching, mandatory compliance checks, training for managers, and standardised KPIs. Better processes would reduce risk, improve quality and build trust on both sides.

Criteria Driving Demand For Contract Roles

In 2026, demand for contract roles continues to be driven primarily by agility and access to scarce skills. Enabling the company to be more agile is now the strongest driver, with 79% agreement, up from 69% in 2025, highlighting the growing importance of flexible workforce models. Access to skills not available in-house remains a core factor, with 69% agreeing, compared with 70% in 2025, reinforcing the skills gap across key sectors.

Additional Criteria Driving Demand For Contract Roles

Cost saving and headcount pressures emerge strongly in 2026, with 68% agreement, indicating budget restrictions and ongoing headcount controls. Candidates’ choice has become more influential, with agreement rising to 50% from 36% in 2025, suggesting greater contractor preference for independent work is shaping hiring decisions. Tight skills market pressures remain consistent, with 56% agreement, largely unchanged from 2025.

Agency influence has increased, with 40% of organisations agreeing that contract hiring is suggested by agencies, up from 36% in 2025. While not the dominant driver, this upward shift aligns with wider evidence of agencies placing greater strategic emphasis on contract recruitment, reflecting a more proactive role in shaping client workforce strategies in 2026.

Key skills

Client companies were asked to identify the skills they find hardest to access in the current market. They highlighted both a shortage of specific skills and a lack of experience in applying these skills in real-world scenarios. Their feedback is summarised as follows:

1 AI, AI/ML and Applied Data Expertise – AI engineers, AI/ML specialists, AI governance, data engineering, SRE, advanced analytics and automation. Clients stress a shortage of contractors who can deliver real, production-level value, not theoretical knowledge or sales-led AI capability.
2 Cybersecurity, Cloud and Enterprise IT Architecture – Cybersecurity specialists, IT security SMEs, ServiceNow, ITSM, cloud, solution and enterprise architects.
3 Senior Engineering and Technical Specialists – Senior engineers, technical SMEs, process specialists, engineering/mathematics profiles, civils, mechanical and electrical technicians.
4 Project Management and Change Leadership – Senior project managers, change management, PM change control and delivery leads.
5 Regulated-Industry and Compliance Expertise – Skills linked to GMP, FDA, EU regulation, pharma, biotech and food safety feature strongly.

Others: Hybrid Technical–Leadership Profiles. Product, Platform and Digital Delivery Roles. Automation, Industry 4.0 and Digitalisation Skills. Sector-Specific and Niche Domain Knowledge.

Skills required to meet future goals

Respondents were then asked to identify the key skills they think would be needed to achieve their goals in the coming years. Their responses highlighted five future-critical skillsets clearly stand out. These reflect both strategic direction and practical delivery needs across organisations.

Top 5 Future Skills
1 AI, Data and Advanced Digital Capability: AI dominates the responses by a wide margin. This includes AI integration, AI management, AI development, machine learning, automation, PowerBI, data engineering, DevOps, SRE, cloud and cybersecurity. Importantly, organisations are not just seeking AI literacy. They want people who can apply AI to real business problems, modernise systems, support decision-making, and integrate AI safely into workflows.
2 Project, Product and Change Management: Strong and consistent demand appears for project management, product management, change management and finance transformation skills. These are roles focused on delivery, governance and coordination, especially in complex or regulated environments such as pharma, engineering and large-scale IT programmes. Clients are looking for people who can turn strategy into execution.
3 Senior Technical and Engineering Expertise: There is sustained demand for senior engineers, process engineers, electrical specialists, IT engineers, validation experts and technical SMEs. Organisations emphasise experience, depth and credibility, particularly where safety, compliance, utilities and critical infrastructure are involved. This reflects a preference for experienced practitioners over generalists.
4 Leadership, Communication and Stakeholder Skills: Human capability features strongly alongside technical demand. Repeated references include leadership, communication, stakeholder management, adaptability, accountability, collaboration and people management. Clients want professionals who can work across teams, influence outcomes, and integrate smoothly with permanent staff, not operate in isolation.
5 Regulatory, Compliance and Operational Excellence Skills: Many responses point to the need for regulatory knowledge, quality, governance, process improvement, lean practices, ESG and operational excellence. This reflects growing pressure to deliver results within tighter regulatory, ethical and sustainability frameworks, especially in highly regulated sectors.

Future demand is not about single skills. It is about blended capability. Organisations need people who combine advanced digital or technical expertise with leadership, adaptability and delivery focus. AI may be the headline, but organisations are equally clear that experience, critical thinking and communication will determine what makes a contractor valuable in the years ahead.

Future Expectations

Clients remain positive in 2026 in both the performance of the Irish economy and the contracting sector over the next 12 months. Expectations for the Irish economy remain strong, with 46% expecting performance to improve in 2026, only marginally below the 48% who expected improvement in 2025. However, a higher proportion now expect conditions to decline 23% vs 15%, indicating growing caution alongside continued optimism. Outlook for the contracting market is stronger than for the wider economy, 59% expect the number of contract roles to increase over the next 12 months, up from 53% in 2025. 65% of respondents believe that the contracting sector will grow over the next 3–5 years, confirming that contractors will remain central to delivery, in the years ahead. Half of clients expect contractors’ daily rates to increase, while 39% expect them to hold steady. Expectations for working days are more stable, with 60% anticipating no change and 34% expecting an increase.

Confidence Index

The confidence index scores are positive +59 up from +27 in 2025, in relation to the contracting sector and+43 up from +22 in 2025, in relation to the performance of the Irish economy in 2025.

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