I spend my days speaking to numerous people who are beginning their foray into the contract market. One of the biggest questions we face and arguably most difficult to answer as it is so personal is whether it is the right time to move into the contracting market.
The differences can be subtle in work but the reasons can be vast and life defining. Below I explore some of the more divisive factors attributing to the change.
When do I start contracting?
Deciding when to start contracting is a big decision in anyone's career and it’s not always a straight forward decision like calling an early election when you think your opposition is down and out.
There's a lot to consider when making the move to contracting and the recent changes to tax laws have made the crossover point closer and more nuanced than a purely financial decision. It can be an expression of your personality and freedom to break the shackles of a more corporate political power party in the thirst for freedom and balance in your work life.
When looking at contracting it’s important to understand both your motivators and the markets motivators. Both need to be aligned to lead to a successful string of contracts. Think about what is driving you to look at contracting? Are you just becoming bored in your current role/organisation? Do you think it will allow you to avoid any internal politics? (it’s a common misconception that you never have to consider this as a contractor) Do you think you have a skill set that is highly valued in the market? (worth talking to someone like me to see if that's accurate). Is this the most poignant moment in my career for contracting to suit my personal needs?
On the flip side it’s good to understand what the market is like; what skills, systems, regulations are in demand, are you at the right level of seniority/experience to secure roles regularly? Do you have a good network of contacts that could keep you abreast of new opportunities and developments should a contract unfortunately not work out (it does happen!)
Do I have enough experience?
This is a tricky one for you to answer and well worth talking to peers and agents about before making such a big move. When clients come to us for contract resource they are looking for solutions to immediate problems. Training or development is not on the agenda so you will need to capable of landing and adding value immediately. The next point to consider is are you looking for further development? Although it is possible to make progression as a contractor I would recommend that you move into contracting when you have reached a level that you are happy to stay at, clients like security of a proven entity rather than taking a gamble on someone stepping into a new role/seniority.
Often experience can be a huge benefit to sidestep the political humdrum of where you are to gain vital skills in different environments to take with you to your long term permanent goal in the future.
Is it a cash cow?
Its an easy assumption to make when you see headline day rates for contractors, the reality is often different. Firstly most organisations will now run a Christmas furlough period that can remove as much as 4 weeks billing from the end of year, in addition any holidays and sickness you take will be unpaid and there's no additional benefits, you'll need to make your own healthcare and pension arrangements.
You might find yourself in a contract for an extended period of time I would recommend factoring in 3 months out of every 24 for not being in an assignment when running the figures. You'll also need to pay for a decent accountant to make sure you stay on the right side of the law!
The money can be lucrative and can change your life in some aspects in what you are able to do and enjoy. With anything so lucrative, there is always risk attached.
If you're considering making the first steps into a contracting career I would recommend some deep thought and a discussion, I'm happy to talk through the pro's and con's and run though your personal situation if it’s something your considering and see if it is the best moment in your career to pursue.