Should You Take a Contract Job?
You should take a contract job because contract work provides additional experience, knowledge, skills, and gives you more control of your schedule. A contract assignment also gives you the opportunity to work in different industries within a relatively short period of time.
Contracting work also gives you the chance to work at a company before committing fully, giving you the ability to seek other employment should the company not be the right fight long term.
Additionally, these contract work experiences are a valuable asset when seeking new opportunities. A long term employee is working at one company for many years doesn’t obtain the experience and knowledge a contract employee does working on many assignments in various industries and companies.
- Should You Take a Contract Job?
- What is a Contract Job?
- What Are The Benefits of a Contract Job?
- Cons of contract work
- How long do contract jobs last?
- Can You Quit A Contract Job?
- Where Can I Find Contract Jobs?
- Should I leave A Permanent Job For A Temp Job?
- What to Watch Out For When Taking a Contract Job
- Does a Contract Role Provide Benefits?
- What Happens When the Contract Ends?
What is a Contract Job?
On a contract job, an employee works for a staffing firm on a W-2 basis under the direction of the client company for a predetermined amount of time to work on specific projects. The staffing agency pays the contract worker and takes out their taxes.
The client company can cancel the contract at any time and the employee can quit the job at any time.
What Are The Benefits of a Contract Job?
- A contract job can give you the ability to work a flexible schedule
- You are able to gain different skills in a short period of time
- You earn higher pay to offset the lack of benefits.
- Contract work gives you the opportunity to work in many industries
- You are able to work in different types of jobs until you find the one that fits your career passion.
- Taking a contract job gets your foot in the door with a company
- You get to test and experience the company culture and see if they will be the right long-term fit without a long-term commitment.
- Working several contract positions will help you build a larger professional network.
- The interview process is generally much faster than a permanent position.
- Enhances your resume with new skills to aid in new career prospects.
Cons of contract work
- The position may lack job security depending on the role
- You will have to search for a new job after the contract is over
- You may be expected to have a very short learning curve for the job
- You will likely have fewer perks compared to a permanent role
- Health benefits may not be as good compared to a permanent job.
- You won’t receive the same sick and holiday pay entitlements as a permanent employee.
- You will have to pay for the training and development of new skills out of your own pocket.
How long do contract jobs last?
Contract jobs generally last from 3 months up to 12 months and possibly longer depending on the role and company you are working for. This means your job is relatively secure during that period of time.
A contract position is not usually counted towards headcount so if a business undergoes restructuring the contract job has the potential to be more secure.
This is when you compare it to a person working full time at the same company that may get caught up in a layoff.
Can You Quit A Contract Job?
You can quit a contract job. When working on a contract basis for a staffing agency you work on an at-will basis meaning you can pursue long-term opportunities or other career paths should one come up that matches your interests.
Where Can I Find Contract Jobs?
Should I leave A Permanent Job For A Temp Job?
If you are worried about job security, health insurance, certain employee benefits, it may not be worth the risk to leave a permanent job for a temp job.
With a temp position, you do not have the stability of a full-time position, though even permanent employment can end abruptly without notice especially in a down economy.
What to Watch Out For When Taking a Contract Job
Pay Rates: Make sure it’s clear on whether you will be working as a W-2 employee or working on a 1099 basis as an independent contractor.
Working as a W-2 employee the staffing agency pays you an hourly rate, takes out your taxes and you should be eligible for unemployment benefits when the assignment ends.
If you work on a 1099 basis you are responsible for paying your own taxes when tax season arrives. You may want to consult an accountant if you have any concerns.
Contract or Temp to hire: Look over the contract offer carefully. Does the position only last for a 6 month contract period or does the position have the potential for you to be a full-time employee? Knowing how long the position will last helps you determine when you will need to have additional work lined up.
How many hours per work are required: Many contract positions require 40 hours a week of work and any hours over 40 you should get paid time and half, though some exclusions do apply depending on the job profession and classification.
Make sure you know these details before accepting temp work and for further information, you can consult the US government’s department of labor website here.
Make sure you have a written offer letter: When accepting contract employment you want to make sure an have a written offer letter that states your hourly pay rate and overtime rate and any benefits that may be offered.
Does a Contract Role Provide Benefits?
Whether or not a contract job offers benefits depends on the company or staffing agency you are working for. Generally, contract work does not provide the same level of benefits you would get working at a company as a permanent employee.
On the flip side, you are generally paid more on the contract due to the lack of benefits received.
What Happens When the Contract Ends?
When the contract period is up the employer may choose to extend the contract for a time period if mutually agreed upon between you and the employer, convert you to full-time status if it was a temp to perm position, or end the contract if the work has been completed.
If you’re not working, need work flexibility, or looking for a quick career change contract work can be a great option to get back to work, learn new skills or work in an entirely different industry.
At the end of the day, each person’s needs and goals are different so it’s up to you to decide what is right for you.