Are contractors better value than permies?

[unixman]

Did you ask your accountant ?

If you have a big 1 year project you can hire 5 permies on the thick end of 50k a year. When the project ends they will remain on your books and are all due an annual pay rise. You can't just dismiss them, due to UK employment law. You can't replace them with cheaper staff, due to UK employment law. Alternatively, hire 5 contractors then just dismiss them after 12 months. Renew at 6 months so you can chop any who are not satisfactory, or just to save costs. Flexibility.

[northernladuk]

Did you ask your accountant ?

If you have a big 1 year project you can hire 5 permies on the thick end of 50k a year. When the project ends they will remain on your books and are all due an annual pay rise. You can't just dismiss them, due to UK employment law. You can't replace them with cheaper staff, due to UK employment law. Alternatively, hire 5 contractors then just dismiss them after 12 months. Renew at 6 months so you can chop any who are not satisfactory, or just to save costs. Flexibility.

Yeah but if a client manages their portfolios priperly there should always be plenty of room for a core set of permies. The contract staff should be there too cover the upswing and downswings in demand, not to be the total solution. Replacing your entire project staff every project is just an awful way to run your business. Something completely lost on most contractors.

Contractors trying to dictate how a client runs their enduring business is generally a pretty bad idea.

[unixman]

I wouldn't disagree with any of that.

[VectraMan]

If you have a big 1 year project you can hire 5 permies on the thick end of 50k a year. When the project ends they will remain on your books and are all due an annual pay rise. You can't just dismiss them, due to UK employment law. You can't replace them with cheaper staff, due to UK employment law. Alternatively, hire 5 contractors then just dismiss them after 12 months. Renew at 6 months so you can chop any who are not satisfactory, or just to save costs. Flexibility.

Assuming it's a one off project, and assuming it's nothing particularly specialist.

Most of the places I've worked are looking to build expertise within the organisation, and that's expertise with their products so generic skills like SQL/ C#/whatever that you might get from the contractor of the month aren't going to cut it. So they look to hire permies and keep them long term, because that's the main value in the business. Contractors are only really useful to help out with some of the donkey work.

[SpontaneousOrder]

I don't know what employers tend to think, but...

There are lots of places where most people are either noobs or they've been there 10-15 years, or more. In these places it's as though the rest of the industry doesn't exist, and some fresh blood now and then which varies experience across different companies can be useful.

Otherwise you end up with clientCos who "do Continuous Integration" because they have a jenkins build, but only integrate features every quarterly release cycle. Then need a contractor on 100K + a year to point out the very subtle point that unless you integrate your code continuously, you aren't doing continuous integration

And then to ask the followup question of: "If you thought that was contiunuous integration, then to what end did you think you were doing it for ?"

[SimonMac]

No they are certainly not (always) better value, we can all list 3-4 contractors on this board that we would cross the road rather than work with.

However what contractors are, are better risks than permies, easier to get rid off and no long term costs for wages, we may think we get paid more than the average permie, but in most cases we cost less over the shorter period

[PurpleGorilla]

I genuinely think contractors are more solution focused, and work on the critical path to get things done.

Permies look at the wider angle of how it might further their career, or become generic or across other projects to realise further value and synergies yada yada.

[Dallas]

ie permies faff, ask my current PM she is ace at it

[unixman]

Neither is better than the other, they are solutions to different situations. My example was not intended to say one or the other is better. Companies keep a suitable ratio of both depending on the situation. Generally, the more new projects and roll-outs a company is doing, the higher proportion of contractors it will tend to have.

[Dallas]

Neither is better than the other, they are solutions to different situations. My example was not intended to say one or the other is better. Companies keep an extortionatly high ratio of both depending on the amount of the fine and media coverage. Generally, the more fines and roll-outs a company is doing, the higher proportion of contractors it will tend to have.

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