The Dangers of Contracting

Danger! Danger! Increased earnings potential!! Speak to any seasoned contractor and they will tell you that you just can’t earn the same money once you take the forbidden leap into full time employment. ‘’If you include the medical insurance, annual leave, pension scheme it’s an incredibly attractive offer…’’ – the HR manager cries – it is still likely to leave you somewhere short, if the net salary hitting your account each month is what gets your pulse racing. The contracting world, if you dare to dig a little deeper, has begun to offer a little more than money for the soul.

Danger number 2. Job Security. The Telecommunications industry has shown an undeniable trend of ‘Outsourcing’ large chunks of newly won projects, only to then ‘Insource’ the work a few years later. Or more realistically, insource a few budget periods later. To many people the idea of ‘’contracting’’ and ‘’security’’ would be considered an oxymoron of note. I challenge you to ask any Procurement Manager whether permanent or contract headcount approval is easier to come by? I promise you they plum for the person who doesn’t need the psychometric test, every day of the week. The simple fact is that restructuring affects everyone within a business, no matter who pays their salaries. The days of contractors getting cut first just doesn’t seem to play out like it used to – if they work longer hours we don’t have to pay them over time right?? If the project ramps down we can just move them to another region without paying relocation fees?? The list is endless. The advantage for a company to have a fluid workforce is becoming fundamental to success. The reality is that security is more likely to be found in the skills you hold, rather than with the company that currently holds your skills.

The final danger of contracting I would like to bring to your attention is long term employability. Let me guess, another one of those oxymoron things??? I put it to you that you may be mistaken, or at worst misled. A recent study involving one of the world’s largest Telco Vendors showed that the average length of a contract with them through external suppliers was a little over 14 months. How many of those people found something else at the end of the contract, moved to an internal position (see above for dangers)? Unfortunately, on that line of enquiry I do not have the answers, all I can tell you with certainty is that within 14 months you will have dismissed the old adage that contractors are merely monetary mercenaries and will jump ship for an extra quid. And be certain that companies will look at your newly acquired skills and increased exposure as an asset for their organization, not as an inherent risk. Being a ‘lifer’ with a company certainly builds up an impressive pension pot and will undoubtedly give you an unrivaled understanding of a company’s working practices. However, within a multi-cultural market place where a second language may be just as useful to you as a second skill, contracting yourself whilst you have the flexibility to do so will make you a much more attractive proposition when you are ready to be tied down.