Nearly 80% of IT directors believe private sector workers provide better value.
Michael Bennett from ReThink Recruitment said that the government suggests the private sector can absorb the public sector redundancies, but employers feel that IT workers coming from the public sector do not offer as much value for money.
It is obviously not going to be as easy as the government expects for these employees to transition into the private sector. Although umbrella company IT employees who have experience of managing highly complex projects do have transferable skills, the private sector is now seeing a growing demand for hybrid IT staff, he added.
Meanwhile, 45% of UK businesses believe the cuts in public sector spending will have an adverse effect on turnover this year, according to the ICAEW.
This increases to 68% of the firms that supply the public sector direct and many have now been forced to explore ways of counteracting this negative impact.
The chief executive of ICAEW, Michael Izza, pointed out that there is a perception that businesses can ‘pick up the pieces’ and this includes employing ex-public sector workers in addition to supplying the drive to return the economy to growth.
However, we are seeing that private sector businesses are already affected by the cuts. 21% of companies saw their business turnover fall last year and the figure increases to 42% of those that supply the public sector direct.
SMEs are suffering more than the larger organisations with 56% of those affected seeing turnover decrease by more than 5%. Construction companies are left particularly exposed after the coalition scrapped the Building Schools for the Future scheme and 70% now think the government austerity measures will hit their turnover in the next 12 months.
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