Techies: Should you be job-hunting this January?

...contractors may be on the last hurrah before times get tough for them too.

"There is a turning point where supply exceeds demand so there are more contractors than jobs. The minute that happens, contractor rates plummet," he says. "We're close to that tipping point in my opinion, I saw it in 2001. A good £800-a-day project manager was all of a sudden taking £300 because they needed a job. They do get hit harder when that supply/demand dynamic shifts."

Businesses are also getting increasingly uncomfortable about the higher rates being shelled out to temps - especially as they face increased pressure to bring business costs down, according to Parity Resources' Rommel. As a result, contract lengths are coming down - from around five to six months, to three.

Contract extension rates have also been reduced by about half, Rommel said.

For contractors looking to make the move to the permanent side, there's some good news: there are still jobs out there. According to REC's Gallagher, while demand varies by sector, a skills shortage remains in certain areas of the city of London.

Gallagher noted merger and acquisition activity in the FS sector is "actually creating" IT jobs, even as other roles are cut, and demand for IT staff in central government is also holding up, he added.

For Alex Farrell, MD of the jobs website The IT Job Board, there are "certain hot areas" where skilled both permanent and contract candidates are likely to be in high demand this year, even during the downturn - including web development techs such as Ajax, Java, .NET and XML, and also web security.

SAP skills are another area Farrell tips to be in demand in 2009. "Even though people aren't implementing big SAP implementations in 2009 there'll still be lots of maintenance to do on recent implementations plus existing systems," she said.

That said, leaving familiar surrounding in the current climate is not necessarily a wise move, according to REC's Gallagher who relates a story of an investment bank employee who sought to further his career by moving to a rival bank only to be made redundant a week later. "Unless [a permanent employee is] totally dissatisfied with their current employment, I think that anyone would be crazy right now - in certain sectors - to think of switching," he said.