Growing up in middle-class suburban Australia, contract work was virtually unheard of. Employment was permanent all the way. The principle option rested in whether you owned your own business or someone else paid you. Everyone went to work day in, day out and took four weeks of paid annual leave a year. Unless you were a business owner, in which case it was possibly less.
When I moved to London and discovered contract work, I was an instant fan. I could hardly believe that someone was going to pay me a rate per day which was nearly double that of a permanent salary to work for a fixed period of time (usually between 3 months and 1.5 years), after which I could gallivant off to explore the world for a while before picking up another contract and doing it all again. But the option was in front of me… and so I have spent the last 7 years working (and not working) on this basis, creating a lifestyle that has seen a lot less work and a lot more play than I would ever have thought possible.
So how does contracting work? The need for contractors is primarily found in situations where a specialised skill-set is required during a fixed term. This often takes the form a project such as the implementation of a new system or to cover the work of an employee who is absent during an extended term (eg on maternity leave or sabbatical). Organisations are usually keen to avoid employing someone on a permanent basis when they know they will struggle to find work for them after the specific requirement for their skills is past. Hence they are often willing to pay a premium for the services of someone with the skill-set required who is prepared to come in to the organisation, employ their skills, impart their knowledge, and leave.
Contract work is obviously far less secure than permanent employment. A contractor has times of employment and times of unemployment. Contracting, therefore, is at its most attractive when the rates on offer are going to compensate you for the down-time you will have between contracts, and leave you with an average rate of pay that is similar to or better than that you would have in a permanent position. Working out what rate is the right one will depend largely on the demand for contractors in your industry and therefore how long it may take to secure your next contract.
While it can effectively support a mortgage if carefully managed, contract work is ideal for those who don’t have regular monthly commitments that see the bank breathing down their neck should they miss a payment or hungry mouths who will complain if they don’t get fed. It is also perfect for those who love to go travelling or amuse themselves in other ways for extended periods of time. Being able to choose when you work and how long for gives enormous amounts of freedom and allows the flexibility to build a lifestyle that includes substantial amounts of leisure time.
But the contract life is not without limitations. It is more difficult to build a career as a contractor. The responsibility for looking after your skills development is entirely your own. There is no set path to career development as there often is as a permanent employee, so you must ensure yourself that each new contract you take will be building your skills and progressing you towards whatever career goals you have. This is not always easy as organisations pay contractors on the basis of providing a specialist skill… if you don’t already have all the skills required in the situation, you will probably not be hired while you learn them.
Global financial uncertainty also has an impact on the decision of whether to take on contract employment or not. In the current times of wide-spread cost-saving measures, new projects aren’t taken on as easily as they once were, and therefore demand for contractors is less than it has been in the past. It is still there, just to a lesser extent so the next contract may be more difficult to find.
So if you’re looking for a sure-fire path to career progression or financial stability, contracting probably isn’t the option for you. But if you’re in the market for a care-free, less structured lifestyle with a focus on immediate more than future income, it’s well worth exploring the options for contracting in your industry.