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The Rewards and Risks of IT Contracting

March 4, 2024
|
Contracting
|
by
Anna Vamos

As an IT contractor, you have the flexibility to control your schedule and work-life balance, choose which projects to take on, and determine how much time to take off between assignments.

This level of autonomy and independence can be particularly appealing to those who value work-life balance.

At FreshConstruct Ltd, we also work with subcontractors, and we believe that many IT professionals are considering becoming contractors due to the growing demand for specialized technology expertise. However, it’s important to be aware of the potential drawbacks as well.

Pros:

Flexibility: As an IT contractor, you have much more control over your schedule and work-life balance. You can choose which projects to take on, when to work, and how much time to take off between assignments. This level of flexibility can be especially appealing to those who value autonomy and independence in their work.

Better daily rates: IT contractors can often command higher daily rates than permanent employees in similar roles. This can be advantageous for those with specialized skills or experience.

Variety of work: Working as an IT contractor can expose you to a wider range of projects and technologies than you might experience in a permanent role. This can be specifically rewarding for those who thrive on new challenges and learning opportunities.

Cons:

Isolation: Working as a contractor can be a lonely experience, especially if you’re working on a project alone or from home. This lack of social interaction can be a challenge for some, and it’s important to be proactive about finding ways to stay connected with colleagues and peers.

Inconsistent income: While IT contractors may enjoy higher daily rates than permanent employees, their income can be less predictable. Projects may be cancelled or delayed, and periods between assignments can be financially challenging.

Lack of benefits: IT contractors typically don’t receive the same benefits as permanent employees, such as health insurance, retirement plans, or paid time off. Contractors are responsible for their own insurance and retirement planning, and must budget for time off between assignments. Ultimately, IT professionals considering contracting must weigh the advantages and disadvantages carefully. While the flexibility and higher pay can be appealing, contractors must also be prepared for the downsides. For example, companies may not pay contractors for the time they spend socializing with colleagues or attending company meetings. (Companies typically only pay contractors for the time they spend directly working on projects or tasks that can be billed to the client. Socializing and attending company meetings are considered indirect activities that cannot be accounted for in the client’s project, thus they are not compensated.) As a contractor, it’s important to understand that having flexibility and higher pay often comes with trade-offs in other areas.

By carefully considering these pros and cons, IT professionals can make informed decisions about whether contracting is the right choice for them.

Summary:

As the demand for specialized technology expertise continues to grow, many IT professionals are considering becoming contractors to take advantage of the numerous benefits that contracting offers. However, it is important to be aware that there are certain risks associated with working as an IT contractor, and these must be carefully weighed against the advantages. One potential risk is the lack of stability that comes with an inconsistent income, as projects may be cancelled or delayed, and periods between assignments can be financially challenging. Moreover, contractors must be prepared to handle their own insurance and retirement planning and may not receive the same benefits as permanent employees. Additionally, working as a contractor can be a lonely experience, which is why it’s important to stay connected with colleagues and peers to prevent social isolation.

Despite these potential drawbacks, contracting can be a rewarding experience for those who value autonomy, independence, and flexibility. However, it’s important to keep in mind that contracting also comes with certain trade-offs that must be considered before making a decision. In the end, with careful consideration, IT professionals can determine whether contracting is the right path for them and navigate the potential risks and rewards that come with this career choice.