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Contract vs. Permanent Employment
by Shabbir K. Ali 2007 I.T. Staffing, Inc.

Permanent jobs ( "full-time employee with benefits" ) in the new economy are anything but permanent; they have followed the trend and demise of pension plans. I often see qualified candidates turn down attractive and lucrative contract employment opportunities while they spend months looking for the perceived stability of permanent employment.

It is important to separate project based contract assignment (specified duration) versus an indefinite contract term; this discussion deals with the latter. It is a common practice in large corporations to classify certain positions as contract, not because it has a limited duration, but due to overhead cost allocation or a "try before you buy" policy. The accounting of employees is significantly different for contract personnel, the most important being the allocation of costs that a division or department has to absorb when hiring an employee as opposed to a contractor. A significant portion of these assignments eventually turn into permanent job offers within the first year or two.

The fact that our dynamic industry offers constant technological enhancements combined with comparatively short product life-cycles lead us to the key (and often most overlooked) benefit of contract employment; the ability to keep your skills current which is especially crucial for technology professionals. If a company is slow to implement new technology, its employees are often less marketable as they have not had the opportunity to work with new or emerging technologies. However, contract jobs are obviously not for everyone.

The need for health benefits that you could otherwise not obtain on your own is the most crucial reason to seek permanent employment. If you have access to health benefits through a spouse's employer then this is not an issue. Individual health policies , barring any critical health issues or pre-existing conditions, can be easily obtained through premier insurance carriers such as Blue Cross or Aetna. Loss of paid vacations and holidays is more than made up by the 20-30% increase in compensation afforded to temporary workers.

Thinking in terms of your long-term career goals, a contract opportunity often provides a better path to upgrade your skills or have a high-profile employer on your resume that you may otherwise not have.





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