To Contract or Not?
Contracting is one of the fastest growing employment arrangements in Australia and around the world according to the Australian Bureau of Statistics; independent contractors along with temporary and casual workers account for over 28% of the Australian workforce. In a 2013 survey they noted that there were nearly 11.6 million employed persons aged 15 years and over. Of these, just under 1 million were independent contractors, over 2.2 million were employees without paid leave entitlements and just over 1 million were considered ‘other business operators’.
But what are the benefits to the individual and to the company thinking of employing them?
Most businesses will employ a contractor to perform tasks that are only required seasonally or for short periods of time. For example, businesses may require contractors to cover particularly busy periods such as end of financial year or Christmas or just to cover whilst sourcing a full-time employee.
But what are the pros and cons in becoming a contractor and why would you consider it at all?
Contractors are usually, but not always, paid more for their work because they are often employed on a short-term basis. Rates can increase even further when skills are in short supply or projects need to be completed at short notice.
The ability to work on different assignments and companies which can provide you with a wealth of experience plus getting involved in new and exciting projects can appeal to those who get bored easily or find routine mundane.
This could be considered a pro if you are looking to travel or further your education between assignments or it could be a con if you need to be earning an income on a regular basis.
Contracting not also gives you the ability to be more selective with who you choose who you work for, but it also, in most situations, have minimal concern for office politics which is favorable to those who prefer to simply go to work, to work!
Working in different companies allow contractors to gain exposure to a multitude of business practices and operating systems. Although adjusting to new technologies may prove challenging in the short term, it can prove highly beneficial in the long term. Those who can adapt and change to match their new environments are more appealing to prospective employers.
Lack of Stability
As a contractor, you must be prepared to be constantly ‘job hunting’. There is no guarantee as a contractor that your role will become full-time or that your contract will be extended. Contractors are usually the first people cut during a tough time so we recommend that you start scanning the horizon for new project opportunities a few months out from your current contract’s completion date. Investing time in networking is important in securing consecutive contracts with minimal or no waiting period but can take a lot of motivation and diligence on your part.
Employers usually hire contractors to complete an important or time sensitive project and contractors are often expected to be fully capable and equipped to perform without requiring any additional training. You must be prepared to jump into the deep end and this can be quite demanding to some. It may also require a lot of self teaching and up- skilling in your own time .
Although contractors get paid more than a full-time employee, they lose out on the benefits of vacation and sick pay. You must be able to budget for times when you are not working and preparing for times that you may go months without work.
Finally, if you are a sociable person, contracting may be a little lonely as you may be left out of employee outings and events due to being the ‘temp’, however, this can also appeal to some!
If you think contracting is a good path for you, be sure to consider the benefits and challenges but ultimately it will come down to your own individual circumstances and preferences.
The team at Elite Executive would be happy to discuss the benefits of contracting with you or if you are an employer; whether a skilled and efficient contractor could ultimately assist you in the long term.
Elite Executive Pty Ltd
0409 59 11 88