The government and the financial services sector have overtaken the telecoms industry as the biggest employers of IT contractors in the UK according to a survey of 2,500 IT contractors.

Contractor services provide Giant Group found that the government has more than doubled its number of IT consultants in the last two years. Now 27% of all UK IT contractors are employed in the public sector.

The financial services sector is the second biggest user of these freelancers, accounting for 24% of the market.

However the telecoms sector slumped to fourth place with only 12% of the IT contractor pool, after having been in second place in 2003 when it accounted for 21% of the market.

“The degree to which the public sector has shown willingness to utilise external consultants in recent years in areas such as IT has surpassed all expectations,” said Giant Group’s managing director Matthew Brown.

“The question for the government is whether it can compete long-term with a resurgent financial services industry in terms of getting the skills it needs.”