Troubleshooting Your Contracting Career

contracting

Between the potential extension of unpopular legislation and sweeping political and economic change, certainty is a rare commodity in the contracting world at the moment. This backdrop can make the daily challenges of life as a contractor seem more difficult than they normally would. You might even catch yourself, in dark moments when you’re alone with your thoughts, considering a permanent role.

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The reality is that most contractors moved away from permanent employment for a reason. You either left behind something you didn’t like or you found something you do, usually a combination of both and it seems unlikely that the answer to your present problems would lie in going back. In this article we’ll examine some challenges that contractors might face, and whether climbing back aboard HMS Employment is likely to be the best solution.

A lack of Job Security

This is the most common reason given for “going permanent” and it’s also the most common concern when making the leap into contracting in the first place. Uncertainty about the future naturally leads us to seek security, and there’s an understandable perception that permanent employment is more secure than contracting.

From the point of view of someone who hasn’t had a permanent job for a while, it might look like employees enjoy more security. Scratch the surface, though, and the illusion is revealed. Most employees in the modern workforce will face a redundancy process at some point, and nearly all will move voluntarily in search of higher pay or a new challenge. The modern workplace is a fluid, cutthroat environment, and competition for jobs and advancement is no less fierce among employees, for all that it happens more slowly, and often less openly.

It’s actually easier for most contractors to “future proof” themselves than it is for employees, since you’re already used to taking responsibility for your own income, and preparing for the occasional stretch of unplanned downtime between contracts. Rather than accepting that permanent job, try adding to your war chest  so you’re better prepared if things get rocky.  

Difficulty finding work

The need to secure new business is an integral part of a contractor’s life, and with each potential new client you’ll need to be the best of multiple options in order to secure the work. Many contractors thrive on this competition and enjoy the challenge, but it’s much easier to do that when you’re winning.

Unfortunately, permanent work is no easier to find, and no more secure, than contract work. There are some differences in the process, but you’ll need broadly the same skills to secure a permanent job as you will to find your next contract. In fact, taking on an employee is more of a risk than engaging a contractor, so the recruitment process is often more rigorous. For the same reason, demand for contractors often increases in uncertain economic times, like the ones many are predicting in the near future.

If you do find yourself losing out more often than you’d like, this is obviously something you need to address, and you’ll likely find the solution in your work-finding process . Take a look at what’s happening when you apply for a new contract, and try to be as impartial as possible. Where in the process is your application usually declined? Maybe your interview technique needs brushing up, or perhaps your contractor CV need some work. Whatever it is, finding and dealing with the issue is likely the best way forward.

Working all the time

The drive to win comes hand in hand with the competition we mentioned earlier but if you’re in a fast-moving field, the additional work required to stay at the top can be exhausting. Likewise, the need to travel a long way or stay away from home can take its toll. The ability to choose when, where and how you work is one of the main attractions of contracting and if you’re working all the time then you’re not actually in control. If this sounds like your life, you could be forgiven for looking at the “nine to fivers” with a touch of envy.

Again, it’s important to see through the illusion here. Just because those employees don’t spend their evenings running a business or reading about the latest developments in their field, doesn’t mean they lead a charmed, stress-free existence. Committing to working nine to five every day, giving up control of your working life and letting someone else decide when you can take holiday doesn’t sound like a recipe for better work-life balance, does it?

The autonomy you have as a contractor can and should be used to make a positive difference to your life. Ask yourself, honestly, do you really need to work so hard? Take a fresh look at your finances, and maybe talk them over with your accountant. You might find you’re already in a position to reduce the amount of time you spend working, and if you’re not you could start working towards that goal.

You can make more or the same money as an employee

Most contractors earn more than permanent employees, so it’s unlikely that you’ll find yourself in this position, but what if a favourite client wants to take you on staff and they’re willing to pay what it takes to get your attention? Would you do it?

There are two things to think about:

Will you really earn more or the same?

You need to do more than compare the headline salary with your usual contracting rate. If you’re trading through a limited company and you’re properly advised by your accountant you’ll pay proportionally less tax than an employee earning the same amount. The employee salary will need to be considerably higher than your contract rate to leave you taking home the same or more. Your accountant should be able to compare them for you.

Is it really about the money?

Once you’ve established that you will be earning more, you need to ask yourself if that’s enough for you to give up your business. Is it really just about the money, or do you also care about being your own boss, and the flexibility and control that comes with that? Does the business you’ve been building mean something to you, beyond a simple time spent vs cash earned equation? As with so much in contracting, only you know the answer.

If you have questions about this issue or if we can help in any way please call our expert team on 01296 468483 or email info@orangegenie.com

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