The financial services sector has overtaken the public sector to reclaim top spot as the UK’s biggest employer of IT contractors, according to the contractor specialist giant group.

The firm believes that the recent growth in investment banking and hedge funds is driving IT job creation in the City.

Giant’s latest Contractor Confidence Index found that 21.2% of IT contractors now work in financial services, compared to 20.5% in the public sector.

Contractors are also confident for the coming year on job prospects, earnings growth and what they look for in a contract.

Nearly three quarters (70%) of those polled said their earnings had increased this year, compared to 45% last year.

The number of contractors not working for 60 days or more between contracts is now just 2.8%, down from 3.3% six months ago.

Matthew Brown, managing director of giant group, said: “Six months ago the public sector employed more IT contractors than financial services – for the first time in history – but it now looks as if the natural order has been restored and the City is once again asserting its dominance.

“As the market strengthens, job security becomes less of a concern for contractors as they no longer expect long periods without work when a contract ends.”