Contract to Hire vs. Perm: Pros and Cons

There are all kinds of ways to work today. From freelancing or contract work, permanent placement, contract-to-hire, and more, it can be hard for a job candidate to sort out the benefits and drawbacks of each of these types of employment. Employers can be confused about which arrangement could benefit their organization.

This article discusses the differences between contract to hire versus permanent employment arrangements so that job seekers and employers can understand the positives and drawbacks of all these options.

Everything You Need to Know About Contract to Hire

A contractor is a worker that is typically temporary and is assigned for a specific length of time. These roles typically offer higher pay and require self-motivation and a high degree of responsibility. Contract to hire positions place the contractor in a kind of “try it before you buy it” position within the contracting company. The benefit in these kinds of arrangements stretches to both employer and employee: each can feel out the other to determine if the role is a good fit.

Some of the pros of being a contract to hire employee include:

  • Usually receive a higher wage in lieu of benefits.
  • The contractor can walk away if the position isn’t a good fit.
  • Sometimes these roles allow for remote work arrangements.
  • Sometimes these roles allow for a more flexible schedule.
  • Can provide a good introduction to a new industry for an inexperienced worker.
  • Teaches new skills while learning on-the-job.
  • Might have the option of transitioning to a full-time role.

While these benefits may sound good to employees, there are also drawbacks to the contract to hire scenario to take into consideration. For example:

  • The work isn’t guaranteed and the contract may end abruptly so there is always an element of uncertainty in these positions. However, having a good staffing agency representing you can help offset this concern.
  • The contract usually does not include paid time off for holidays or vacation.
  • It could be harder to acclimate to a new environment because the employee may not be perceived as part of the permanent team, at least at first.

But What About the Permanent Employee?

On the flip side, there are permanent positions available in most industries that can eliminate some of the uncertainty of being a contract worker. But like every job, there are pros and cons.

The pros of hiring a permanent employee include:

  • Having a fairly regular schedule and routine.
  • Less financial risk.
  • Benefits and perks.
  • The opportunity for advancement.
  • Income taxes and insurance are deducted straight from the paycheck.

While these all sound like positives for the future employee, permanent employees face challenges as well:

  • Only have a limited number of days off every year.
  • Less freedom to take time off.
  • Less opportunity to negotiate a pay raise.
  • May not be able to branch out and learn new skills in another job.
  • Stuck within a certain industry.

While many people still prefer permanent positions, the employment market is wide open today with a variety of options for people with top skills. Employers must carefully consider the pros and cons before conducting the job search.

Contract and Permanent Roles in a Tight Labor Market

Knowing your options is a crucial part of the job search process. Blackstone Technology Group is a firm uniquely poised to help companies attract and retain the best talent and employees find the best opportunities. Contact us for contract and permanent roles that can help you meet your goals.

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