So, the question of the changes in contractor confidence is one that has been under consideration for some time.
For a while now, contractor confidence has been rather negative. In fact, this is the first positive metric that has been seen since the second quarter of 2021. This is over a year with a negative viewpoint of contractors.
However, this metric is specifically contractors rating their own optimism around their prospects for the coming three months. This is quite a narrow window of foresight. Yet this being positive for the first time in quite a while is still something to consider in its own right. It is of course a good thing overall.
There have been a wide range of financial issues in recent times, which will come as no shock. Shortly after the IPSE study was sent out to contractors, inflation hit a 40-year high. This kind of issue should have sent shockwaves through the contractor community and perhaps affected opinion.
Still, it is just one of many issues contractors have been experiencing lately but perhaps there are other things to be positive about.
As we reported recently, less than 6 months ago contractors confidence were taking a much more negative view of their situation. When looking at their perceived prospects for the next 12 months, they are less positive. There are more that feel negatively about the situation than feel positive overall.
Even so, this is still an improvement in comparison to responses taken at the end of 2021.
Cost of Living Impact on Contractors and Freelancers
Looking at a recent Qdos poll, this is not the only thing that freelancers and contractors have concerns about. The cost-of-living crisis has had an effect on contractors. No wonder that over 60% are worried about the cost of living and higher costs generally.
Under 5% selected that they were not concerned at all, so this is affecting most people. And we should perhaps consider this with a bit of a pinch of salt as there were only 240 respondents. It is not surprising though that contractors mirror the rest of the population in feeling the pinch.
For contractors, and freelancers, their income is rarely guaranteed for long. The job that pays well today may be gone tomorrow.
We can still take some positives from the way contractors report to be feeling. There is obviously a glimmer of hope to be seen within the financial darkness. Having short-term belief in yourself and the work you are offering is a good place to be.
This kind of positivity keeps the contractor market going. Despite the issues around IR35 and the unpleasant stories coming out of HMRC’s wranglings with individuals and organisations, contractor confidence opinion is on the up.
Let us hope that the next IPSE survey paints an even more confident and decisive picture. After all, contractors and freelancers are unique in the economy.
Perhaps sector-specific support for these groups could be considered. Although given the path HMRC is following at the moment, perhaps that is a little too ambitious.
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