The credit crunch has followed problems in the US sub-prime mortgage sector, which specialises in loans to people with poor credit histories or on low incomes. Rising interest rates have led to record levels of loan defaults and home repossessions - and that has sparked fears about which lenders might be exposed to the bad debts.
There has also been a slowdown in takeover activity, with banks less willing to lend the money needed to complete deals.
How does this affect contractors?
Well, we have seen some big players in the banking industry write off billions in bad loans as a result of the crunch. However, the financial service sector is still recruiting more then ever, and paying them more!
Recruitment Agencies illustrate that despite the wavering UK economy, banks and insurance companies and brokerages still need skilled IT contractors. There are nearly 100,000 such contractors working in the City of London alone.
The current economic uncertainty seems to be boosting a demand on banks may put a freeze on permanent recruitment, increase redundancy and create more opportunities for contract worker.
As Tarpon employees are provided with a reference of employment, this gives piece of mind to lenders as there are lending with security and ability to get those funds back.