Permanent vs Contracting - Confused!

[nomadd]

Now look at it this way - one contractor, 13 years experience in various IBs, changing roles every few years, keeping skills fresh, with significant warchest. one permie, 13 years experience in the same role, skills going stale, attitude embittered and resentful. Who has more chance of getting a new job (paying as well)? Who is more "secure"?

Exactly.

[Ruprect]

Thanks for the insight.
No verbal promises of a bonus at the potential new employer, though they say that I am eligible.
How many years would you say does it take to progress from AVP to the Director cadre?

The only incentive I see in the perm role is my shot at becoming a Director/MD/Regional COO. I have never heard of a PM becoming a CEO at a bank!

Some example numbers alongside approx periods in roles:

Permie
AVP - VP probably 3 years at AVP - say, 75K avg over that time total comp py
VP - DIR - probably 6 years at VP - say 100K avg total comp p/y

So, 825k * 60% = 495k take home for 9 years work

Contractor on 500 pd, 45 weeks a year
500 * 5 * 45 * 9
1012500 * 70% = 709k take home for 9 years work

VERY approximate - bear in mind for the permie number take home is not actually take home, some of this will be tied up with pensions, "benefits" etc. Bear in mind also, that one you reach Dir you'll be looking at around 125k (admittedly with a chance of a bigger bonus, but not guaranteed) - your contractor on 500 pd is still taking home 78750 where your dir is taking 75000 and working 3 more weeks a year than you, so really, you still haven't reached the inflection point. Also, are you sure you'll get there (to dir)?

If you made it to MD (prob 15 years at least) you start making the really serious cash, but they are like rocking horse sh!t, and have a shed load of responsibility. To get to that point you'll have had to put in probably twice as much *effort* as a contractor. And also at that point you'll be timesing your income by .5 instead of .6 due to the 50% tax rate.

HTH.

[northernladuk]

The IB who is my current client have just let go of all the contractors in my area except me. AND they've got rid of 90 odd permies too (so far). Now look at it this way - one contractor, 13 years experience in various IBs, changing roles every few years, keeping skills fresh, with significant warchest. one permie, 13 years experience in the same role, skills going stale, attitude embittered and resentful. Who has more chance of getting a new job (paying as well)? Who is more "secure"?

A good point I concede but still there are one sided assumptions here so not impartial. embittered, and going stale?? Possibly in some cases, particularly the public sector but a sweeping statement. I have been made redundant and none of us fell in to this class at all.

Also going back to nomadd's post, there is constant mention of managers with 10-15 years. My point is that is 10-15 years more security than many contractors don't have. They, if we are talking like for like skills with a contractor, will get a job pretty soon and be there for quite awhile. In all that time the contractor may have been through a number of contracts not knowing where the next one is and a bit of bench time. Weighing this up (and the permies that get let go every 6 months v contractor with 5 or 6 years per client) I still believe permie is more secure than contractor. Of course you can look at a whole host of micro situations but the bigger picture is still the same.

I fully appreciate you have had an illustrious and lucky contractor career with training being given, moving roles/skills and long terms at clients. A contractors dream indeed but most certainly not the norm or situations to plan or expect. Think about the people we get on here who couldn't organise a piss up in a brewery let alone run a long term professional contracting career. You have to include them in the contractor picture as well as people like yourself.

[Ruprect]

A good point I concede but still there are one sided assumptions here so not impartial. embittered, and going stale?? Possibly in some cases, particularly the public sector but a sweeping statement. I have been made redundant and none of us fell in to this class at all.

Also going back to nomadd's post, there is constant mention of managers with 10-15 years. My point is that is 10-15 years more security than many contractors don't have. They, if we are talking like for like skills with a contractor will get a job pretty soon and be there for quite awhile. In all that time the contractor may have been through a number of contracts not knowing where the next one is and a bit of bench time. Weighing this up (and the permies that get let go every 6 months v contrctor with 5 or 6 years per client) I still believe permie is more secure than contractor. Of course you can look at a whole host of micro situations but the bigger picture is still the same.

I fully appreciate you have had an illustrious and lucky contractor career with training being given, moving roles/skills and long terms at clients. A contractors dream indeed but most certainly not the norm or situations to plan or expect. Think about the people we get on here who couldn't organise a piss up in a brewery let alone run a long term professional contracting career. You have to include them in the contractor picture as well as people like yourself.

Yep totally subjective - it was one of the guys that just got the can where I am. Sure he's not the only one like that though.

[Ruprect]

Think about the people we get on here who couldn't organise a piss up in a brewery let alone run a long term professional contracting career.

true however they probably shouldn't be contractors

[MarillionFan]

NL / Rupes. You've got some dodgy calculations / discussions going on above about perm vs contracting.

Apart from the argument about becoming CEO/CIO (which no CEO/CIO has ever done wasting their time posting tulipe on an internet forum) you really should be basing your career/incomes on the best you can get as each situation arises. If that means jumping to perm for 2/3/4/5 years before a move back into contracting and then doing your own business for a while or at the same time for tax reasons etc than you should do. You should always take the best opportunities and mitigate as best as you can.

IMHO of course.

[Ruprect]

NL / Rupes. You've got some dodgy calculations / discussions going on above about perm vs contracting.

Apart from the argument about becoming CEO/CIO (which no CEO/CIO has ever done wasting their time posting tulipe on an internet forum) you really should be basing your career/incomes on the best you can get as each situation arises. If that means jumping to perm for 2/3/4/5 years before a move back into contracting and then doing your own business for a while or at the same time for tax reasons etc than you should do. You should always take the best opportunities and mitigate as best as you can.

IMHO of course.

Fully admit the calcs were rough - but you get the point

[northernladuk]

NL / Rupes. You've got some dodgy calculations / discussions going on above about perm vs contracting.

Apart from the argument about becoming CEO/CIO (which no CEO/CIO has ever done wasting their time posting tulipe on an internet forum) you really should be basing your career/incomes on the best you can get as each situation arises. If that means jumping to perm for 2/3/4/5 years before a move back into contracting and then doing your own business for a while or at the same time for tax reasons etc than you should do. You should always take the best opportunities and mitigate as best as you can.

IMHO of course.

You are right MF you are right. Sorry

[nomadd]

I fully appreciate you have had an illustrious and lucky contractor career with training being given, moving roles/skills and long terms at clients. A contractors dream indeed but most certainly not the norm or situations to plan or expect.

Why don't you look at it the way I do: He's been smart and planned ahead; flexible and keen to take on a new challenge when it presented itself; kept his skills and knowledge up-to-date; and exploited his skills both for his own benefit as well as that of his clients. He's a real contractor.

Now, sure, like you said, there are a few "muppet" contractors around, but these forums show that most contractors are actually pretty smart and plan ahead - about where they are today and where they could be in a few years time with some hard work and reasonably focused effort. Most of the questions we see here on the forum are from keen individuals who wish to better themselves. And there are many, many long-termers on here like myself who've "re-skilled" several times over in their contracting careers. Sure, we get "lucky" breaks once in awhile, but that's always because we've put ourselves in the situation for those lucky breaks to occur - i.e. been prepared to move around and try new things and accept the responsibility for seeing the job through.

Now compare that to most permies I've worked with over the last two and a half decades... Actually, let's not, as we all know the stories too well and we'd just descend into several pages of moaning about the lazy B'stards...

Still, hopefully the guy who started this thread is now less "confused" about "Permanent vs Contracting." He just now has to decide what type of person he is. We've certainly given him a lot to think about.

Now, off to do something far more useful like shooting guys in Rage (RAGE: Amazon.co.uk: PC & Video Games).

[yetanotherbob]

If it helps the OP, I was in this position a year ago.
I was also 28 then with 5 years of experience under the belt.

One year into permiedom, I turned 29, much wiser and i'm a contractor through and through*. Now 1 month into a 3 month gig... Much happier.

*To me that means: get in, get the job done, invoice, get out.