The cloud services market is growing and this could benefit umbrella company contractors and sole traders working in the IT sector.

The REC is concerned that the government’s proposed immigration cap will lead to a greater skills shortage in certain sectors. However, this has annoyed some contractors who feel threatened by cheap labour from outside the EU.

IntaPeople, an IT recruitment company has warned that key IT personnel, including those working through umbrella companies, will resign from the public sector and secure better opportunities elsewhere.

Both the BCC and the CBI have hit out at the coalition’s proposal to abolish the default retirement age from April 2011. The BCC’s director of policy, Adam Marshall, says this will restrict the ability of businesses to manage their workforce.

The government has announced that they will once again look at whether a general anti-avoidance rule should be introduced as a measure to deter limited company tax evaders.

Contractors could be better off as a result of George Osborne’s announcement that the income tax threshold will change. The REC said that temporary agency workers who only work for short periods will be especially delighted with the budget announcement.

The FSB had urged George Osborne to give small businesses time to implement any changes to the VAT rate and he did indeed do so in his budget speech yesterday.

The British Chamber of Commerce has warned George Osborne to tread carefully with his plans to increase taxes in today’s budget. UK umbrella companies will also be watching with interest.

There are more opportunities available for IT contractors according to the latest Monster employment Index report. 11% additional vacancies were advertised online in May compared to the previous month.

Freelancers and contractors who rely on the public sector for contracts could find themselves struggling to find work according to the CIPD.

Small businesses and umbrella companies should plan ahead in order to cope with the changes that are likely to be introduced in next week’s budget.

Welcome news for temporary workers and freelancers comes in the form of the REC’s JobsOutlook report for June and the ONS.