Reply to: Contract 250/day vs Perm 50k

[nomadd]

Touch what? Perm work?

No, a barge pole.

Nomadd

[SteveMcadden1]

Touch it with a barge pole

Touch what? Perm work?

[BolshieBastard]

I can understand someone who hasnt had a contract for 6 months or more considering permie. Me? I wouldnt touch it with a barge pole.

[FarmerPalmer]

If it helps I was on a 60K package with a 10% pension and a 20% bonus at a financial institution and I ve given this up to do contracting at 400 per day.

Yes its a bit more then what you are earning, but a lot less then what others are asking for.

If I was you I would take the contract every time.

WHS - I previously have been offered a permanent job at a salary the same as my turnover but turned it down to contract. Salary + perks would be greater than my turnover - but I prefer to be my own man.

My last permie job package was greater than my current turnover and I chose voluntary redundancy to go contracting.

Employers seem to want you to work 60 hour weeks these days and its written in the contract of employment to do the hours to meet business needs so you can't say know I need the weekend off. As a contractor I don't get that and can't get pushed into it (and if I do choose to do longer hours then I know that I will get paid by the hour).

But then I have been lucky to have continuous work since I started back on the game 2 years ago.

[joey122]

If it helps I was on a 60K package with a 10% pension and a 20% bonus at a financial institution and I ve given this up to do contracting at 400 per day.

Yes its a bit more then what you are earning, but a lot less then what others are asking for.

If I was you I would take the contract every time.

[shoes]

Completely concur with this, and I don't frankly 'get' the hourly rate * 1000 comparison. Ive worked for 30k odd permie and 250/day, I made around double after tax and 'benefits' with the contract.

Something else to bear in mind, for 250 a day contract you wouldn't be expecting to do much work at all, for 50k permie they'd be all over you cracking the whip.

[ASB]

Permie job. Assume "normal" benefit package. This will then produce about 36k net income in a year for 210 days work. you will also have (depending on package) probably about 5k in pension contributions from the employer and have "enjoyed" benefits of approximately 1500 in heath care and life insurance.

Now, lets do 210 days contract. You will be billing 52,500. Assume that all the beneifts are of zero worth to you. Assume outside IR35, assume income splitting. Then with a bit of luck you might retain about 42k.

If you want to put youself in the same position (which may or may not be valid depending on the viewpoint of the OP) then you might just be able to do it from the contract. With accountancy and insurance costs of nil of course.

Both roles will of course have some cost of income associated with them. Train fare, lunches etc. Some at least of these are claimable if taking the contract. So this may make the balance move a little towards the contract - or at least make equilibrium easier to find.

If the only motivation between the roles is available spending power it seems the best one can hope for is the contact ends up equal. Inside IR35 it would be a disaster zone.

Now look at the travel time. The contract extends the working day by about 20%. So the best available from the contract is, effectively, to work 20% harder for the same money.

I realise money is not the only motivator. Opportunitiies it opens up might be. The permy role is finance based. The contract health. Which one is better to be into? Don't really know, but living in a nominally capitalist economy the financial role is at the whim of business. Health at the whim of government. Think that might be a hard choice.

For me, the permy job looks like a no brainer. Sorry, buit on those number thats the way it is. The only justification for taking the contact is wanting to remain outside permiedom (that of course could easily be compelling).

If the contract was a more realistic 350 per day the choice would be much harder.

[TykeMerc]

If you don't have major personal issues with being an employee, I'd recommend the perm job. 50k ain't at all bad, and I would struggle to ever take work which required a 90min commute (assuming you mean 90min there, 90min back).

I agree.

I also agree that £50k isn't roughly equivalent to £500, more like £250.

There are other plus sides to the permie role compared to a sub £300 day rate that you're no doubt aware of.

If faced with the same choice myself, despite being a contractor for so long, I'd take the permie gig.

[mace]

No brainer

Permiedom doesn't guarantee longevity but, on average, a permie role will last longer than a contract, especially £50k permie roles, which with fringe benefits will be between £55k and £60k. Your commute's much shorter, you may get some friendly colleagues to go for a pint with, and you might get some better quality work.

[chicane]

50k perm strikes me as the obvious choice. Not sure what field you're in - I can easily get 250pd contract but most perm salaries in my field max out at around 40k.

[Turion]

250/day is equivalent to about 33k/year perm based on the well known 1000 x hourly rate conversion. The perm job p1sses over the contract in every way. However you will have to jump through more hoops to get it and be up against much better competition who will be from permie backgrounds.

[swamp]

Take the £250 a day. Hold off signing until the last minute and gazump the agent for an extra £100 around 4:30pm on the Friday. Settle halfway at £300 and push for an extra £50 every renewal date.

Meanwhile accept the perm job as a fallback in case your poker game doesn't work.

[Green Mango]

Both roles are at the same level when it comes to financial rewards, so, you need to look at how each role is going to look on your CV, and help you further your experience, personally, I'd rather have Financial related business on my CV because I know its relevant and will add value to my CV. At the end of the day there is no real permie role, if you don't like the company after afew months, then there is nothing obliging you to stay.

I'm so sure about that. If the perm role has company pension with the sick pay and holidays. Seems to me the perm role is the better paying.

[zamzummim]

Both roles are at the same level when it comes to financial rewards, so, you need to look at how each role is going to look on your CV, and help you further your experience, personally, I'd rather have Financial related business on my CV because I know its relevant and will add value to my CV. At the end of the day there is no real permie role, if you don't like the company after afew months, then there is nothing obliging you to stay.

[TroubleAtMill]

Assuming you can keep the contract role for 12 months then it's probably marginally better financially. Of course that's a big assumption and, as you pointed out, you'll be spending 5-10 hours a week more traveling.

I agree with Not So Wise and d00g to grit your teeth for 12 to 18 months until the market is better.