Contract work vs full-time employment, which is best for you?
The workforce is evolving. There’s an emergence of contract work opportunities and it comprises 40% of the workforce today (a number that continues to rise). That now begs the question, is contract work right for you?
Full disclosure, as a platform that connects consultants and contract workers to companies, we understand we may seem a wee bit biased here. But that’s also why we understand that contract work isn’t for everyone. So we decided to write this comparison article to give you as much info about both options. This way, you can see what type of work will work best for you (see what we did there).
So, if you’re not sure which is right for you or you’re on the fence about making the switch, check out this list that compares contract work vs full-time employment.
Lifestyle & Flexibility
When it comes down to it, it’s a lifestyle choice. Assessing your values will help you decide what’s most important for you.
If you value stability and comfort, then full-time employment may be the better option for you. Full-time is great if you enjoy routine and prefer staying with a company for the long-term.
If you value independence and freedom at work, then contract work is the way to go. It’s the perfect path for the more adventurous or entrepreneurial type who thrives on new challenges. You have the control to select the contract jobs that interest you and can even travel and work remotely (working from the beach anyone?). With flexibility, you can also opt-out of the 9-5 grind and choose a schedule that fits around your life or your peak periods of productivity.
If unemployment or uncertainty scares you then chances are you’ll prefer a permanent position. Permanent employment usually offers security advantages such as unions and termination notices.
That being said, being let go can still be a possibility, but this still may be the safer route overall.
Lack of security may be deterring you from stepping into the flexible workforce. Finding your next contract can sometimes seem time-consuming or unpredictable.
However, with your rate being higher than a full-time employee, you can afford some time off in between contracts. Also, If you’re on a platform that connects you to upcoming contract jobs, *cough cough* Splice *cough*, you will increase the predictability of your future work opportunities. You’ll also avoid the tedious job searching, update your resume easily and organize all your engagements in one place.
There’s no denying how valuable benefit plans can be. Some companies offer their employees packages with medical coverage, paid sick leave, parental leave and pension plans. These do come in handy and do give you some peace of mind for the future or any obstacle that life may bring.
The lack of group benefits is sometimes a drawback if you’re considering contract work. Thankfully, you can still have coverage as a contract worker. You can be covered under a spouse’s or family member’s benefits package or you can simply apply to a personal health insurance plan such as one from Blue Cross. Also, as a Canadian independent worker, you may be eligible for Employment Insurance benefits through the Government of Canada.
When you’re a permanent employee at an organization, chances are they are committed to helping you develop your skills. Many companies offer in-house specialized training or will pay for development courses that will contribute to your professional growth.
Working in a permanent position also offers possibilities to climb the corporate ladder and obtain promotions within your company.
For some, contract work is preferable since you have the opportunity to gain experience and grow by working on different projects throughout your career. By working on different projects, you’re likely to learn how to use new platforms, technologies, and processes. You also can work in different types of industries which expands your scope of knowledge. These insights, new skills, and experiences can be added to your resume which can lead to higher-ranking positions or rates for your future contracts.
On a side note, if you’re more comfortable with full-time employment, starting on a contract can be a way to get your foot in the door of some of the best companies and could lead to a permanent role. Contract work can also help you expand your network to find future opportunities.
While the take-home salary for full-time employees is often lower than that of a contract worker in an equivalent position, other perks can make up for this.
Such perks include health and work benefits as well as commission or bonuses for hitting company targets.
As an independent contractor, you’ll most likely make more money than if you were an employee in the same position. Companies are willing to pay more for contract workers because they don’t have the enter into expensive, long-term commitments or pay for onboarding, health benefits, unemployment compensation, and social security taxes.
Also, the more varied experience and opportunities to improve your skillset that comes from moving to new companies will help you increase your rate faster.
While some prefer stability and others prefer variety, there are some perks that come from both contract work or permanent work so it just depends on which one is most suited to you.
Also, depending on where you are in life, you may prefer one over the other and there’s no rule that says you can’t change paths throughout your career.
If you want to eliminate some of the uncertainties of contract work and find a network that keeps you informed on upcoming contract opportunities, check us out at Splice.co.