Contracting is the thing to do in Singapore right now. As banks struggle to justify a permanent hire in technology currently, many are turning to temporary resources - and rates are rising.
While some banks (Citi, J.P. Morgan and Standard Chartered chief among them) are building their permanent IT workforces in the city state, many more firms are taking on temporary staff to fulfil their technology needs.
Over the past 12 months contract rates have increased 10% to 15% on average, while top-performing temps who move firms can command pay rises of up to 30%, says Kelly Soh, a consultant in IT financial services at recruitment agency Robert Walters in Singapore.
Rates are expected to rise at a similar rate over the next year as banks demand more contractors but the supply of candidates stays steady.
“Standard Chartered, Deutsche Bank and Credit Suisse are some of the main firms hiring more contractors due to increased project work and lack of headcount approval,” says a recruiter with knowledge of the banks.
“Cost efficiency is a top priority due to the economic slowdown in Singapore, so banks are now more hesitant to increase their permanent headcount,” says David Jones, senior managing director for Asia Pacific at recruiters Robert Half. “Using contractors allows them to adapt more easily to changes in the market and avoids a long recruitment process.”
International banks in Singapore are increasingly recruiting IT contractors to oversee short-term projects, adds Jones. “This gives them more flexibility, and interim managers can look after specific projects that lie outside the expertise of existing employees.”
Banks that are moving low-end IT roles out of Singapore are also hiring contractors to ensure the offshoring process runs smoothly and to maintain business continuity.
Contractor talent crunch in Singapore
Getting hold of enough temporary technology staff is not always straightforward for banks in a country where people have traditionally viewed contracting as a last resort rather than a good career option.
“There’s a significant shortage of skilled contractors in Singapore as most good IT professionals are in the permanent workforce. A greater general acceptance of contract work is still an emerging trend here,” says Jones.
The average mid-level IT contractor at a large global bank in Singapore now earns about S$6,800 a month, says Mellissa Mayne, an associate director at recruiters Page Personnel in Singapore.
But although contract rates are ticking up across the board, the largest rises are in the most sought-after job functions.
Hot IT contract jobs
“Pay in application development has increased more than in infrastructure,” says Mayne. “This is because the nature of the role in development is tougher, and requires longer working hours and stronger skills. Java development and desktop support on the trading floors are the two most common IT contracting jobs.”
“Test analysts, project managers and business analyst are in demand as contractors because most of these jobs are project-based and banks can transfer people from one project to another,” adds Soh from Robert Walters.
Global banks in Singapore are also hiring more specialist contractors to improve their regulatory and cyber security systems. “They are reviewing their technology platforms to meet recent regulatory changes,” says Soh.
IT contractors who work in big data, digital mobility and cloud-based solutions can command higher pay rates than the industry average, says Jones from Robert Half. “This is due to more demand from banks and a shortage of professionals within these new technologies.”
Jones says IT contractor jobs in Singapore have become a “lot more specialised”, with an increasing number demanding 20 years’ experience or more. “These professionals are more adept at managing a bank’s short-term projects.”
Expatriate banking tech professionals are generally more open to taking temporary jobs, says Jones. “It’s becoming increasingly common for financial institutions to fill IT contracts from the foreign and expat talent pools.”
Most IT contracts in Singapore last for 12 months, although some six-month stints are available. “Anything less than this is not at all attractive to candidates here,” says Michael Nette, a director at recruitment company Ambition in Singapore.
While their rates are rising, Singapore contractors don’t receive the large pay premiums over permanent staff that their counterparts in more mature contracting markets enjoy. In London, for example, some banks have cut pay rates over the past two years but contractors still tend to earn more than employees.