Employers are optimistic the predicted property slowdown won't materialise - but more firms are still opting to hire temporary workers, writes Gabrielle Monaghan

Temporary and contract workers are growing in popularity amongst employers as the Irish recruitment market increasingly mirrors trends in its larger US and UK counterparts and domestic companies aim to become more flexible in the event of a downturn, industry consultants say.

"Ireland typically follows trends in the UK, which follows the US, and both these markets have a higher percentage of temporary and contract staff," said Gerald FitzGerald, operations director for Premier Recruitment's businesses in Dublin.

While Irish recruiters say employers are optimistic that a predicted slowdown in the property market won't have knock-on effects on consumer demand and that the jobs market will be as robust this year as in 2006, the temporary employment model adds greater flexibility to their annual business plans.

The likelihood of slower growth in the property market, though, is "in the back of people's minds" in the financial services sector, though the industry is forecast to continue its hiring spree anyway as it develops more sophisticated methods of investing and making money, says Edward Cox, managing consultant at the banking division at Qualitas People Solutions.

"Temporary work is increasing across the board in Ireland and companies like that they can hire staff but not increase their total headcount," Mr FitzGerald said.

CPL Resources, the State's largest provider of temporary staff, posted a 42 per cent surge in contractor and temporary fees for the year through last June.

The increase reflected demand for non-permanent staff in areas such as office management and administration, customer service, and engineering as well as in the healthcare, pharmaceutical, and medical devices industries, the agency said.

"Companies are looking at how they are structuring their business and while certain industries are moving towards more permanent work, there is an increase in the use of temporary staff," said Garret Roche, a CPL director. "And because manufacturing has taken a hit over the last couple of years, with high-profile factory closures, some employers in that sector are moving to temporary staff."

The driving force behind higher demand for temporary staff can also be attributed to the need for flexible working arrangements for existing staff to facilitate better work-life balance in the workplace, according to Mr FitzGerald.

"There are more part-time workers and job shares, on top of maternity covers," he said.

Indeed, the latest human resources management survey released by employers' body Ibec revealed that four out of 10 companies in Ireland increased their use of such arrangements over a 12-month period. More than half said there had been a rise in demand from staff for these arrangements. Almost a quarter of the companies surveyed said staff were working from home one or two days a week, a third had flexi-time arrangements, and 65 per cent employed permanent part-time staff.

Contractors are also in demand, especially in the IT and engineering sectors, as many company workloads become increasingly project-based and employers require specialists for short periods of time, Mr Roche said.

Overall demand for IT staff is on the up as a result of a dip in the number of people who began training in 2001 and 2002 following the collapse of the dotcom industry, according to Damien Kehir, management director of Eden Recruitment.

"Everyone is chasing the same people in IT as the number of graduates has dropped," he said. "Java and other skills are proving difficult to get."

However, the "madness" that accompanied IT salaries in the frenzied days of the late 1990s is nowhere to be seen in today's marketplace, Mr Kehir said. "Employers are not paying over the odds now," he said. "While back in that period all the talk focused on share options in the industry, now candidates themselves are looking at how long the company has been in business and at the medium to long-term view."

Memories of the downturn in the Irish economy in 2001 and 2002 have prompted employers in all industries to become more cautious about their business plans and to make allowances this year for the series of interest rate hikes that have come on stream in the past 12 months, says Bernadette Cox, deputy managing director of Brightwater Recruitment.

"Employers are now quietly confident about the year ahead as opposed to shouting loudly about how well they'll do," she said.

"In certain areas, candidates will have more than one offer. But we're not going back to silly season when some companies would take the first person to come along."