Contract or Perm – Which is the Right Route For You?





Contract or Perm – Which is the Right Route For You?
11 May 2017

Contract or Perm – Which is the Right Route For You?

Although the traditional career pathway often leads directly to a full-time permanent role, there are other modes of work that might better suit certain styles of working and circumstances. Temporary and contractor roles are common, especially in industries such as business change and transformation, and have their own unique benefits and drawbacks.

If you’re considering switching from contractor to permanent or you’ve always wanted to try contract work but have been afraid to make the transition, then it’s important to weigh the pros and cons to determine which option may be right for you.

Contract roles

Temporary and contractor roles are growing in popularity, with projections of a 50% contract workforce by 2020. Temporary positions can be likened to a lengthy job interview, as some of these positions can become permanent.[1]  Contractors also often enjoy the more flexible lifestyle and typically higher rate of pay offered by contract opportunities.

The average contract time is six months, meaning that contractors have the opportunity to experience a wealth of different offices, projects, personalities and businesses, giving them flexibility while utilising their specialised skillsets. This can be invaluable for those who are motivated and enjoy the excitement of each new contract opportunity.



This often extends to lifestyle, meaning that you can negotiate to work hours or days that suit you, or even take an extended holiday at certain times of year. This can be beneficial in terms of work-life balance.

Build a network

If you enjoy meeting new people then a contractor role is ideal as you may be moving between departments, interacting with colleagues and stakeholders at all levels.  Moving from company to company is a good opportunity for networking, which could help bolster your future career prospects.[2] To secure new contracting opportunities, you will constantly have to win new work, so building a strong network is essential.

Nurture new skills

By regularly switching projects you have the opportunity to glean an extensive repertoire of new skills and experience, potentially in a range of sectors, industries and business sizes.


Contractors often receive higher remuneration than their permanent counterparts. Equally, if you are registered as a limited company there are tax efficiencies that can help you maximize your earnings.


With the rise of agile working, the term has become familiar in the business lexicon. But contractors also boast agility in the sense that they must learn to easily switch from one job to another.[3]


Lack of benefits

Benefits are typically minimal when it comes to contractor roles. This can be a significant drawback when it comes to things such as pensions.

Less security

Contractor work is often less secure because you have no guarantee of work when your contract ends. This can be a significant issue if you have financial commitments, and are concerned about gap in work between contracts. 


Permanent roles are valued because of their security and stability. A permanent role provides regular income and hours, and a chance to progress within an organisation . But there’s a selection of other benefits and drawbacks to consider when it comes to choosing a permanent role compared to contracting.



In a lot of ways, a permanent role is the safe option. Employment laws provide you with additional security, give you rights, and protect you in case anything goes wrong. You don’t need to worry about any of the legal responsibilities of being an independent contractor.


From gym membership to workplace pension plans, permanent employees are offered a number of benefits that typically are not available to contractors.


With a permanent role, there is a not a fixed end point as there are with contract roles. This stability allows you to take on long term projects and work towards goals, with the assumption that you can continue to work and progress within the organisation.


Permanent workers typically feel a stronger sense of attachment to projects and receive more praise when a project goes well, especially if it takes a while for the results to pay off. 


Long-term employees often have more trust than contract workers. Trust is nurtured over time, so in a permanent role there is more time to build relationships among employees, including with those at the management level.[4]


Lack of Flexibility

Often permanent employees don’t enjoy the same level of flexibility as contract workers. Contract workers often have the option for flexible working arrangements, such as remote working, which often are available to permanent employees.


Permanent employees usually stay with a company for a much longer tenure than contractors, who usually have shorter, fixed-term assignments. Contractors are able to frequently change and experience different types of organisation s, sometimes across multiple industries or business sizes, giving them variety in the type of work they do. In contrast, permanent employees fall into more of a routine with less variety, as they often work for the same company for several years.

To Each Their Own

Ultimately contractor and permanent roles have their own merits and drawbacks. Typically contractor work is right for a certain type of person, or for a particular lifestyle a candidate is looking for. But even if you’d prefer a permanent role in the long-run, a contractor role could help you find a company that suits your needs as some contractors are eventually offered full-time work. Equally, working permanently provides stability, security, and a chance to progress within a company, which is appealing to many people.

If you need help deciding on the best path for you, or if are looking to change from permanent to contract work, or vice versa, the experts at Phaidon International can help.


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