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back to article Budget-slash fest shaves 10% off IT mercenaries' day rates

Cost-cutting at banks and a squeeze in the public sector have pushed IT contractor day rates in the UK down by £38 since 2010. Freelancing tech bods are therefore taking home £9,000 a year less than two years ago. But the recent RBS/Natwest banking crash offers a silver lining for developers: those skilled in the ancient ways …

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  1. Lee Dowling Silver badge

    I never got the "we run 1970's cobol because it ain't broke" mantra.

    Sure, you don't fix it. But you should damn well have parallel systems that perform the same functions in testing and have them there for decades to check their results always tally with the old junk. If you do it right, that means that should anything happen, you can just switch to the new code and carry on.

    It reminds me of the switchover for Dabs.com who started out using code hand-written by the founder and then ended up doing an "upgrade" the other year to something that couldn't cope and didn't work. Why "switchover" at any point when you should be doing a smooth transition with result-testing to make sure everything tallies no matter which code you used? And if you do smooth transitions all the time, it's not a problem to upgrade systems, staff, skills whenever you want because nothing goes into service until it's tested and nothing goes out of service because you have no-one who knows how it works.

    You're honestly telling me that it's cost effective to run mainframes on decades old code that nobody understands and then paying a fortune every time even the most minor thing goes wrong, and then paying HUGE transition costs on a short schedule if you absolutely must upgrade because of the problems, rather than just adding X% to costs, cycling staff (no old-timers who cost a fortune and are necessary to keep things running), cycling hardware, etc.?

    I thought these people were supposed to know about money? I thought these systems were supposed to be critical.

    Running on Cobol because "it worked" is not something to be applauded. That's like NASA still using the Apollo launch computers at ground control to handle their latest launches. Where you absolutely CANNOT upgrade, it's excusable, but come on.

    And, I'm sorry, but the whole "we have to run batches overnight" crap was something that seemed outdated back when I sat my A-Level Computer Science exam years ago. You're honestly telling me that your systems can't cope in real-time nowadays? Really? How comes my "amount available" is instantly reflective of every online transaction within seconds then, but I don't see my "balance" decrease until a week later? Or is it just a way to find new methods of telling people they're overdrawn for a microsecond?

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    1. Alan Bourke
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      Inertia counts for a lot in business IT

      ... that's why ancient, unwieldy cack like EDI is still used.

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    2. Anonymous Coward
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      Anonymous Coward

      That might be what they say

      but they know it isn't true.

      "we run 1970's cobol because it ain't broke" sounds a lot better and is a lot shorter than:

      "we run 1970's COBOL because we've made serial ill planned acquisitions and built a vast, complex tower of cobbled together systems teetering on the edge of melt down, we've fired all the people who know about them to save money, and we're too bonus-obsessed, short term and IT illiterate in our thinking to design and build a new, efficient, modern, properly documented and maintained core banking system that meets our needs and those of our customers, with capability to add and remove functionality without messing up the core (oh, and with a specific "easy test" parallel capability to check system changes before they go live).

      Maybe somebody somewhere has actually done this, but certainly it doesn't reflect the shambles that I read about in the press or hear about from my couple of contacts who are IT pros working in the financial services sector.

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      1. Anonymous Coward 101
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        Re: That might be what they say

        Robert Peston notes on the recent RBS feck up that "...it is striking that in the boom years before the crash of 2007-8, none of the big banks replaced their so-called legacy systems with new modern ones - which some would see as another example of how they did too little sensible long-term investment when the sun was shining, and are now struggling to mend their roofs in less clement weather."

        http://www.bbc.co.uk/news/business-18577109

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    3. Anonymous Coward
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      Anonymous Coward

      There is a lot of sense in what you say Lee, but I feel that you don't comprehend the complexity of relationship of big business and their IT systems.

      I never got the "we run 1970's cobol because it ain't broke" mantra.

      Sure, you don't fix it. But you should damn well have parallel systems that perform the same functions in testing and have them there for decades to check their results always tally with the old junk.

      I'd like to see how you justify the "lets buy the latest new shiny thing just because its new" and the "lets have two parallel systems for decades" to the bean counters. The two questions that the business are going to ask you (for new stuff) is how is this going to provide additional competitive advantage over the old system? If it doesn't it's going to be "feck off, you're not getting any of my budget for new toys". It'll be the same for parallel systems, if you are lucky you get parallel running just as far as the month end on the assumption that if it works for month end processing it will also work for quarter and year end processing.

      re Dabs and "smooth transitions"

      Very rarely does a commercial organisation "transition" to a new system, most development is incremental, you may develop a core system for your business, as the business grows you have to start bolting on additional pieces, you add MIS, HR, payroll and a pile of other crap to manage the management of your systems. Then you decide to upgrade your MIS system by buying a new package, but then you have to considerer the interfaces to the old systems, usually some rewriting of these interfaces is also required.

      You're honestly telling me that it's cost effective to run mainframes on decades old code that nobody understands

      Yes it is. Code that hasen't been touched for decades is code that dosen't change, the parts of a system the change frequently are well understood.

      old-timers who cost a fortune and are necessary to keep things running

      Really?, the last time I looked it was the Java heads that were the expensive ones

      And, I'm sorry, but the whole "we have to run batches overnight" crap was something that seemed outdated back when I sat my A-Level Computer Science exam years ago.

      There's a good reason for running overnight batch systems, it allows you to collate data from lots of different sources and apply them to an account in the correct order, for example apply credits to an account before debits, most online banking systems can cope with realtime updates, but really, do you want all your standing orders and direct debits to be bounced just because your salary was a microsecond late in getting to your account?

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  2. Anonymous Coward
    Anonymous Coward

    "IT Mercenaries"

    http://dilbert.com/strips/comic/1998-08-19/

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  3. Anonymous Coward
    Anonymous Coward

    Average is the important word there

    It may be only a few quid average drop in rates, but in my field (PMO) I'm seeing significantly higher cuts in day rates. A friend was recently asked if she would go back to where she was a year ago, but the rate is now £100 a day less than she was getting then for the same role. Cuts of up to £50 across the board in FS companies on last year's rates are the norm for PMO, and for that they want someone who is multiskilled (e.g. PMO AND PM AND BA, or VBA programming, or DBA). So it may be not so bad for certain technical roles, but for my area money is significantly tighter & we were a lower paid discipline than techies in the first place.

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  4. Karirunc
    Happy

    Few times over my long contracting career I have been offered a cut. Each time I have politely declined, and had a nice long break. This has improved my work life balance, and I have enjoyed a great deal. Also, each time after I have returned from the break, I have been offered more money, either by same organisation, or somewhere else! Fact remains that we are underpaid, and by large don't have to take shit from anyone, or be treated like number. Try it. I warmly recommend it.

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    1. Anonymous Coward
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      Anonymous Coward

      Thats fine taking a break, but after a few months you go back into the market to find 60-80 other equally qualified candidates all after the same contract. And as half of them are formerly permies they tend to go in at a lower rate so get chosen before you. Some of us have luxury tastes like mortgage repayments & food that need paying for, and eventually the money will run out.

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      1. Gordan
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        @AC 09:59:

        Doesn't really work like that in my experience. (Disclosure: I am a career contractor and have never had (nor sought) a permanent job in the past 20 years of working in the IT industry since graduating.) You get what you pay for, and unless your prospective hire is in extremely extenuating personal circumstances, you aren't going to get contractor quality at permanent prices.

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    2. Jim 59
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      Rates

      Something to be said for that. And rates would improve is we were all less accepting of lower pay.

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  5. Gordan

    By my reckoning...

    According to my rate/inflation analysis spreadsheet, the _real_ contract rates peaked in 2008. Since then, when adjusted for inflation (both against CPI or RPI), they have dropped on average by about 10%. This 10% is also after accounting for the fact of an extra 4 years of experience (although in fairness, considering I'd already been doing this for more than a decade and a half back in 2008, an extra 4 years probably doesn't actually count for that much, sadly).

    Having said that - I agree with what Karirunc said above. Until recently I had never taken any time off (my contracts have always been back-to-back, or at most a couple of days inbetween), so sometimes I had taken on my next contract at a rate lower than the previous, just because it came along and I had nothing better to do. Having a family as of recently has certainly made me realize the huge advantages of taking time off instead of a lower paid contract.

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    1. Kubla Cant
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      Re: By my reckoning...

      I find that the trouble with time off between contracts is that it's only time off if I already have the next contract agreed. Otherwise I split my time off between looking for a contract and worrying that I haven't found one yet.

      This despite 28 years of contracting during which I've had a total of about eight days between contracts. Maybe I'm too insecure for the contracting life.

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  6. PaulM 1
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    Many contractors have had a 10 year pay freeze already

    This article makes it clear that it contractor rates have fallen this year. What it does not make clear is that many contractors have had no cost of living increases for the last 10 years AND that overtime pay has disappeared.

    Also these figures do not include employer's national insurance, acomodation costs or pensions. True salaries are half those quoted here

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