At the beginning of 2022, IT freelancers and contracting companies were positive. But the year was marked by uncertainties: The war of aggression on Ukraine, rising energy prices, inflation and the aftermath of the Corona crisis all weighed on European minds. A full 45% of the clients surveyed by freelancermap believe that there will no longer be a normal state of affairs in the future.
The expectations of the companies surveyed for the future of the national economy look rather meager: Only 19% of the ordering companies believe in an upswing (according to “Companies in crisis mode”, Hays).
Hays’ Skilled Workers Index also points to a negative correction in the demand for IT professionals in the third quarter of 2022.
But what is the real impact of uncertainty on the project market?
We have summarized the key messages of the most important Freelancer Studies 2022 for you:
HAYS Skilled Workers Index Q3 2022- Demand for IT specialists
The Hays Skilled Workforce Index determines the demand for skilled personnel in (IT) positions and the various industries on a quarterly basis. Although this also includes positions in permanent employment, the freely accessible study is very suitable for assessing the general mood of the contracting companies. Hundreds of online job exchanges are included in the index.
Demand was consistently subdued in the third quarter. The only exceptions are IT project managers and IT admins. The positions for which demand is falling the most are IT security specialists (-28 percentage points) and IT architects (-12 percentage points). Nevertheless, this remains at a very high level: more cyber security specialists are still being sought than at the beginning of the year.
Compared to the same quarter last year, there is varying demand for IT specialists in the various sectors. Demand increased in only two sectors: personnel services (+9 percentage points to 74%*) and automotive (+9 percentage points to 62%*). The uncertain economic situation is being felt in the other sectors. Here, demand for IT specialists fell across the board (*compared with quarter 1/2015).
Freelancermap Market Studies 2022
With the Freelancer Kompass, Freelancermap publishes an annual market study that gets to the heart of freelancers: especially with regard to hourly rates, order situation and everyday project life. The majority of the freelancers surveyed work in the IT sector. In addition, this year the Project Exchange conducted a survey on the client side.
Hourly rates*: 92€ is what IT-freelancer receive on average. Freelancers in SAP (116€), consulting and management (113€), in IT (104€) and freelance IT infrastructure professionals (92€) earn the most.
Workplace: 69% work remotely (home office), 40% hybrid, and only 17% reported working on-site at the company.
Challenges: Freelancers have particular difficulties in the areas of project acquisition (58%), the separation of work and private life (35%) and the issue of bogus self-employment (29%).
Special evaluation: IT Freelancer Compass 2022
In the course of the freelancermap study, IT Freelancer Magazine together with Freelancermap made a *special evaluation, the IT Freelancer Compass . Here, the tech topics are highlighted in particular and the individual values are considered specifically for IT freelancers.
In October, freelancermap published even more study results. Here, the impact of the Russian war of aggression on Ukraine was addressed. These are particularly noticeable towards the end of the year in the form of restrained contract awards to freelancers on the project market:
Order situation: Only 35% of freelancers rate the order situation as Good or Very Good. At the beginning of the year, the figure was 67%.
The percentage of freelancers who rate the order situation as poor or very poor increased from seven to 24%.
More than half of project providers (57%) believe that companies are hiring fewer freelancers primarily due to the inflation and energy crisis.
Lünendonk market study: The market for IT workforce services in Germany
The IT Workforce Study is, so to speak, the former Lünendonk List. Here, in contrast to the last few years, there are exciting innovations: Now the perspective of clients with regard to the IT project market is also added. In addition, the pure contracting view is expanded to include the entire IT workforce (including employee leasing and permanent placement).
Total revenues of the top 25 IT staffing companies rose by 14.3 percent to 5.1 billion euros.
The top 15 staffing firms in the IT contracting sector placed an average of 679 permanent and 2,359 freelance IT professionals.
Highest freelancer hourly rates:
1. IT Audit/ Cyber Security (75-210€)
2. AI/ Data Science (50-200€)
3. BI, Big Data, Data Management (65-190€)
4. project management (55-190€)
5. business consulting/ organizational consulting (60-175€)
Factors influencing hourly rates: Onsite vs. remote (69%), experience (56%), skill shortage/availability (50%), specialization (44%).
Malt’s study, in collaboration with the renowned strategy consulting firm Boston Consulting Group, examines similar aspects to Freelancermap’s study. However, this study adds the comparison to the other countries in the study (France and Spain).
Use of freelancers in companies:
43% of German freelancers (on Malt) work with small companies, 37% with medium-sized companies and 20% work with corporations.
Average German Daily rate: 790€ ( 3x higher than in Spain, 1.5x higher than in France).
Biggest challenges: clients, administrative tasks and financial volatility.
Political situation: 77% are dissatisfied with the legal framework in Germany.
Continuing Education: More than 62% of freelancers have in their career min. 2x changed their specialization. Freelancers invest an average of 4 hours per week for personal training.
The Solcom Freelancer Studies are based on a survey of freelancers who have subscribed to the SOLCOM Freelancer Magazine. They are published several times a year. This year, the focus was on the freelancer project market and the state of automation in the course of Work 4.0.
Project market index: Q3 2022 down 4.19 points to 103; Q1 it was still at 110 points
Highest hourly rates:
1. SAP consulting
2. consulting process management
3. consulting ERP
4. software development SAP
5. project management process management
6. project management software development
Most Demanded IT Qualifications:
1. embedded software development
2. consulting SAP
3. java development
4. full stack development
5. SAP development
6. C# programming
…10. PLC programming
Hourly rates: Increased: 61%, Stagnated 34%, Decreased 5%.
Project utilization: According to 47%, project utilization has improved or is stable (49%):
36% of IT freelancers are working at full capacity (more than 100%).
42% have an occupancy rate of 76-100%
and only 12% are half or less utilized.
Project extension: 83% of freelancers are (relatively) certain that their project will be extended. Only 4% of the projects are not to be extended.
Factors for project selection: The most important factors for freelancers are the hourly rate (89%), the task (76%) and, interestingly, the proximity to the project (38%). In 2021, only 22% considered this factor important.
State of automation in Germany Company: Around half (48%) describe the State of automation of dt. Company as backward. Only 19% are of the opinion that this is far advanced.
Industries: The automotive industry is 74% fully automated, followed by telecommunications (63%) and finance (59%), he said.
Business units: IT automation and production/warehouse technology lead the way with 40%.
But it is precisely the area of low-code/no-code automation that is lagging behind 9% full automation.
Conclusion: Continued high demand for IT freelancers
Despite the correction to the second half of the year, the demand for IT specialists remains at a high level.
The fact that companies are currently focusing heavily on investments in digitization (43%) and technology (34% ) to defy the crises (see below) should also allow IT-freelancer to breathe a sigh of relief. That’s because the accompanying demand for more complex IT infrastructure will continue to drive the need for software developers, architects and cyber security consultants. The German automotive industry’s need to catch up in the area of e-mobility (see Hays Skilled Workers Index) is also driving demand for IT specialists, such as embedded systems developers.
According to Lünendonk, IT projects are not discontinued, but adapted. In addition, one in five companies prioritizes digital transformation over cost-cutting measures and continues projects as planned. The project market for IT-freelancer will therefore remain stable for the time being. It remains exciting to see what 2023 has in store for the IT project market.