Are Contractors Overpaid

[NoddY]

I think you'll find usury and rent are the real scams. There's always honour in working for your living.

[d000hg]

well if they didn't want a £500 pd contractor they could always go to a big system integrator or consultancy who will happily rent them a graduate as a 'consultant' for at least £800 per day.

So because there are bigger rip-offs, it's ok. Is that your argument?

I wish I could find the clients paying £800/day for consultants. I struggle (but manage) to convince clients half that is not extortionate after they visit RentaCoder

[MPwannadecentincome]

So because there are bigger rip-offs, it's ok. Is that your argument?

No I'm trying to put it into context without biting the bait.

There are some organisations happy to spend millions on the big integrators and consultancies. There is one global company I know that spent millions on an invoicing system. Yes just an invoicing system.

There are others that balk at the costs and work out how to do it cheaper. Next down the food chain are the smaller consultancies and contractors - where in comparison to the big boys there are potential savings to be made in costs if the right ones can be found - here the small fish in the big pond have to have some reputation to be found or to get work.

Then there are those who want to pay absolutely rock bottom for maximum return and will hunt down the right outsourcer or the cheapest contractor they can get - sometimes spending more having to have the work done more than once.

IMHO

[CheeseSlice]

I might seriously be naive but can anyone RATIONALISE and justify why contractors get the rate they ask for (and how senior IT management dont look at the numbers and fall off their chairs)

Project managers love it. How else can they get someone skilled to do the job they want on a short project, then once complete not have to pay them ever again without having to first initiate them, give them paid holiday, maternity cover, sick pay, pension, a personal development plan, training courses, a boss, a line manager, and then making their job formally and expensively redundant when the job is done.

No brainer.

A contractor is also getting what I like to think of as 'danger money'.
I'm out of a contract next month and I may not see another for months, or I may get one straight away - who knows. The uncertain life I chose, and the flexibility it provides to my customers commands a higher rate than someone who receives more protection in permanent employment.

I'm not saying permanent employment is protected, as I've lost a job that way, but you are likely to get something for your trouble before you leave.

[threaded]

Fair enough - What exactly do you do

A lot of people are C# / Java developers with a smittering of financial knowledge.

Not exactly HIGHLY specialised

Yes, many of my clients get some kids straight out of college, give them fancy titles and set them off building a system.

Then they come to people like me to get them out of the tulip they've been dropped in.

Some of them, I'm thinking of one recent client, did this three times before they came to me.

So, reality is, I'm preeeeetttttty cheap.

[RichardCranium]

My first proper contract was building and managing a team of 8 contractors to do in 6 months what PWC with a team of 50+ had failed to do in 2 years.

Most of that 50+ were green graduates with no clue at all. They were being paid for by the taxpayer at something like £1k per day so that they could get some work experience. They in turn were probably getting something like £18k per year.

I think we as a team were cheap.

[d000hg]

A contractor is also getting what I like to think of as 'danger money'.
I'm out of a contract next month and I may not see another for months, or I may get one straight away - who knows.

I know it doesn't quite work that way, but outside recession you'd kind of think someone good enough to get £500/day should be good enough to find work quite easily. In a recession, I am not sure contractors are any safer than permies... at least contractors expect to end their contract and are prepared, whereas permies are generally shell-shocked when made redundant.

[BlasterBates]

Well Joey in time if you are a contractor, then you will find that landing a £500 contract is not easy.

Can you explain how you walked into your 500 day contract?

[darmstadt]

After rounds of layoffs three senior developers from a team of 5 have fled. There are 2 grads left - well meaning but not immediately useful. Its a 24x6 system where downtime means chunky loss of money and reputation. It also needs fairly regular customization (weekly Saturday release). It requires one to be in office by 7AM and on-call support overnight (Asia trading hours). They are looking at offshoring most of the work in 6 to 10 months time. They need someone to keep the lights on.

I don't quite understand why a developer would have to provide this type of service. They write the programs, hand them over to the respective team who should be given all necessary documentation to provide their own support. If the application needs to be changed fairly often then its (a) either never been properly specced or (b) the changes are being made on the fly with no real testing being performed. Sounds a bit of a pigs ear which is probably why they want to offshore it....then it really will be a pigs ear

[cojak]

because the alternative is to pay one of the big shops 3-4 times as much for a spotty grad.

What he said.

With the difference being I actually deliver something at the end of it.

You'd be amazed at how difficult that bit seems to be for many big consultancies.