Category: IT Staffing

We 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 a short-term project based contract assignment (specified duration) versus an indefinite long term multi-year contract; 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 not otherwise 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 or under the Affordable Care Act, 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.

Among the most frequently asked questions from job seekers converting from salaried to a contract or consulting positions is that of compensation. Specifically, how to convert their current or desired salary to an hourly rate for a W-2 contract assignment. The following steps can be used as a guide:

Divide your annual salary by 2080 (annual hours worked) to arrive at the raw hourly rate {A}
Multiply your raw hourly rate {A} x number of desired vacation days + Paid Holidays x 8 (hours per day) {B}
Add in your annual health insurance premiums {C}
Add your annual salary + Vacation / Holiday Pay {B} + annual health insurance premiums {C} and divide by 2080 to arrive at your hourly rate inclusive of basic benefits
As an example, assuming an annual salary of $100,000, 3 weeks of vacation + 6 paid holidays, and $4800 in health insurance premiums, the hourly rate would be:
$100,000 / 2080 = $48.08{A}
$48.08 * 15 vacation days + 6 paid holidays * 8 hours/day = $8077.44 {B}
Salary $100,000 + Vacation & Holidays $8077.44 + Health Insurance $4800=$112,877.44
$112,877.44 / 2080 = $54.27 Contract / Consulting hourly rate

You can add other benefits such as employer’s 401(k) contributions to this formula, however, it is important to note that the job market ultimately determines the going rate for your skill set. You must set realistic expectations by researching the job boards to gauge what the employers are paying for your skills. There are other benefits to working contract which should also be considered in addition to your compensation.

All staffing agencies and most major employers use an Applicant Tracking System (ATS) to manage resumes. According to Ed Struzik , an IBM expert on ATS technology, the percentage of large corporations using such systems is in the high-90’s. Among many features and benefits of an ATS is the ability to filter resumes based on keywords. It has become increasingly important to ensure that you resume is “ATS friendly” or that your resume is parsed correctly by automated software applications. Here are some tips to write an effective resume:

Use simple formatting without Headers/Footers, Columns or Tables
Avoid any special characters and fancy bullets and never include images or graphics
Stick with common fonts and do not use colors
Save your resume in MS Word or Text format only, do not use a PDF format
Do not use Templates as they use formatting that you will not detect readily
Use common headings such as Summary, Experience, Education etc.
Be consistent when writing your employment history. For example, Company, Title, Location and Date (in reverse chronological order)
It is important to remember that in the end your resume content is what will get you noticed. Be very specific when describing your skillset and responsibilities