The split of permanent to contract work in the FS projects and change industry has been rebalancing recently.
More perm options are becoming available, particularly at the more junior end. But which option is the more appealing for you?
The biggest draw of contracting is the most obvious and well publicised: You can earn vastly superior sums of money at a similar level of seniority. A salary of £50k per annum would translate to approximately £350 per day for the same role in the contracting space. Working 240 days a year, this would leave you with pre-tax earnings of £84k; a 59.5% increase from perm. This coupled with utilising a shrewd accountant can lead to a much healthier net earnings figure for the year.
Putting aside purely financial motives, some individuals prefer to stay away from the proverbial ‘office politics’, contracting at most Banks and Asset Managers can help you achieve more effectively. Finally, some contractors just particularly enjoy being responsible for delivering change and moving on to the next challenge, never wanting to become bogged down in the same environment.
Lack of job security tends to be the biggest issue with contracting. Many contractors find themselves at the end of an assignment, no extension in sight, without another role in the pipeline. This sudden void of income and routine in life can be particularly trying. Also, serial contractors who jump between jobs frequently can find it difficult to move back into permanent roles, particularly in the latter years of their career - this is often down to hiring managers questioning their longevity.
Permanent employment, by its very nature, brings with it greater job security. On top of this, you know exactly what you will be paid every month. Other benefits are numerous in both cash and non-cash terms. Paid sick leave, annual leave, pension, bonuses, private healthcare to mention just a few. Permanent can also be easier to get back into if you have time out of the market due to travelling/maternity leave/ill health. My advice to candidates starting off or wanting to get back into Projects is to always go perm, whether that be through a consultancy or direct.
The interview process does tend to be more strenuous and drawn out for perm. Three and four stage interviews are not unheard of, with an array of psychometric and HR test to be traversed even after getting the business to approve of you. Another frequent qualm I hear from candidates is they feel as if they have hit a glass ceiling and are pigeonholed, often at VP level. This ceiling can be difficult to break and as a result many choose to take the contracting route and return to perm at a higher grade a few years down the line, effectively using another course to jump the corporate ladder quickly.
As with all things, there is no right or wrong answer, much of your decision comes down to personal choice, lifestyle and ambitions. If you are looking to buy a house, raising a family and feel you need the security of permanent, then perhaps that is the best option to take. Alternatively, you may be at a stage in your life where you feel a little bogged down at work and want to break the mould, take more of a risk, deliver change at different institutions and cash in on the higher daily rates. A final and potentially contradictory point to note is that the difference between contract and perm is slowly narrowing. With longer interview stages and lengthy due diligence processes, some of our contractors take as long as six weeks after offer to get on the ground with a client, not quite the quick turnaround associated with contracting.
If you have any questions around contracting or permanent employment in the Projects and Change market then please don’t hesitate to get in touch.