He believes many permanent staff will be looking to move into a contracting role this year to exploit the demand and dollars to be made.

"It is going to be interesting for IT workers in 2006," Owiti said, because big projects will rise more than is normal for the IT industry as a result of banks and telcos approving large development projects.

"Most of last year Telstra was holding back its restructuring and now it needs to get work done which will cause a flow-on effect across vendors as well as contractors; the banks will be looking for IT implementation and testing staff," Owiti said.

"I expect this will cause two things to flow on. Either companies will increase the salaries of staff to keep them on or those staff will become contractors. We will see a lot more skilled employees turn to contracting to maximize the pay and permanent IT staff will start heading in this direction too."