Contract Work: The Pros and Cons of Being a Contractor

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Accepting contract work is an option that some job searchers look at not only when they are having trouble finding fulltime work but because of the lucrative nature of contract assignments.
Typically, contract work can run anywhere from around 1 month to 12 months in length and sometimes, even longer than that.

Depending on the industry and job, contracts might differ in length but as a recruiter, this is the typical range that I tend to see available.

Depending on the specific situation, here are some possible benefits of contract work:

1. Money
Contractors typically get paid on an hourly basis for actual hours worked with no benefits or holidays paid but depending on the specific job, can often make more money than if they were doing the same job on a fulltime basis. Hence, working on contract - especially if you can find a long-term contract of 1 year or longer - can be quite lucrative. Plus unlike most salaried staff, contract staff get paid overtime.

2. Variation of Work
Contract work often allows you to change your jobs frequently especially if you are working short-term contracts. There isn't much chance of getting bored if you are constantly working on new projects or for different companies.

3. Tax Benefits
Depending on your local tax laws, you might find tax benefits if you are self-employed and have the ability to write off business expenses.

Considerations
There are some possible negative aspects you need to think about when it comes to contract work. First off, some employers can be turned off considering you for a fulltime job with their company if you have a recent track record of working on contracts.

Since one of the benefits of contract work is the money you can make, hiring managers tend to be aware that many people who choose to work on contracts do so because of the monetary benefits. Therefore, they might be hesitant to hire you fulltime believing you would not stay with them long term earning a salary if a more lucrative contract appeared.

You might need to convince a hiring manager that you will stay long term if your recent work history is made up of contract work.

Also, be prepared for periods of unemployment during slow times. If you're fortunate, you can pick up a new contract when an old one is ending but it doesn't always work that way.

Following Y2K when I was working as an Information Technology recruiter, the market for most IT professionals - and especially contractors - went down the toilet as companies had spent their IT budget (and then some) upgrading their systems preparing for Y2K. After this, the dot com bubble burst and then September 11 occurred and by then, many IT professionals had been laid off and previously high-flying contractors were forced to take far less paying fulltime jobs just to get back into the workforce.

Finally, if you're accepting contract work but prefer fulltime work, keep in mind that timing doesn't always work in your favour. If you are several months away from finishing a contract and a great fulltime job comes along, what do you do? You might not be able to break your contract to take the fulltime job and the company offering the fulltime job might not be able to wait until your contract is over to hire you.