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Stability is Key for IT Contractors

There is an elephant in the IT contracting industry: most IT contractors want permanent positions.

Research shows that the main reason for their preference is that permanent jobs, by their very nature, promise more stability. Permanent employees receive consistent paychecks and healthcare benefits without the additive stress of a looming contract end-date.

Another reason for their preference is that many consultants feel like “second class citizens.” Permanent employees can receive perks like onsite gyms or child care services. With longer-term roots planted in their organizations, permanent employees can also form deep professional and personal relationships with their coworkers. In contrast, contractors tend to be excluded from such perks and often feel that they lack a peer community.

But, is permanent work all it’s cracked up to be?

And the Survey Says

Consistent with other industry surveys, TEKsystems’ annual consultant survey found that approximately 70 percent of IT contractors would prefer a permanent position. These individuals cite better benefits and stability as reasons for their preference.

Is Permanent Work All It’s Cracked Up to Be?

Despite the consultant’s stated preference for permanent work, research indicates that permanent employment today is not as appealing as it was in the past.

One reason is that healthcare benefits have deteriorated in the last decade and out of pocket costs of employee-insured permanent workers are not that different from self-insured workers. Since 2000, average employee contributions to company-provided health insurance increased by more than 120 percent. Average out-of-pocket costs for deductibles, co-payments for medications, and co-insurance rose 115 percent during the same period.1

Interestingly, former consultants rated TEKsystems’ benefits significantly higher than current consultants. Could it be that when consultants leave the contract world they learn that permanent work is not as appealing as they thought?

Another reason permanent work is less attractive today is because permanent jobs do not really last that long. While it was common for an IT employee in the 1970s to remain at a single job throughout their career, the average job length of an IT worker today is only 4.5 years. It is even shorter for higher skilled workers.

Contract Work Benefits

  • Higher compensation than salaried work
  • Flexibility
  • Exposure to a variety of companies
  • Opportunities to learn new skills

Contract Work Disadvantages

  • Medical benefits not paid in full by employer
  • Limited or no paid vacation
  • Excluded from team company events
  • Length of time between assignments

Is Stable Contracting Possible?

Yes. Good contract workers who possess in-demand skills and are able to market themselves will have little trouble finding continuous employment. As Michelle Webb, TEKsystems’ director of technical professional programs, states, “contract work can be very continuous if you’re good at what you do.”

In addition to having a marketable skill set, partnering with a strong recruiter can definitely help keep a contractor employed long-term. Most every recruiter has some personal incentive to staff a contractor on an assignment. The best recruiters, however, take the time to ensure they really understand their contractor’s skills, goals, interests and references. This information can then be used to identify relevant job opportunities and to “sell” a contractor’s qualifications to potential hiring managers.

A strong recruiter’s job is far from over once the consultant starts a new role. It is critical that recruiters stay in tune with new skills the contractor develops and provide further growth opportunities through performance feedback and/ or formal training courses. Additionally, as project needs and timelines often shift in the IT world, the best recruiters proactively communicate with both the hiring manager and the contractor regarding contract end-dates. The earlier a recruiter can secure a final date, the more time they have to market the contractor for upcoming opportunities.

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About TEKsystems®

People are at the heart of every successful business initiative. At TEKsystems, we understand people. Every year we deploy over 80,000 IT professionals at 6,000 client sites across North America, Europe and Asia. Our deep insights into IT human capital management enable us to help our clients achieve their business goals – while optimizing their IT workforce strategies. We provide IT staffing solutions, IT talent management expertise and IT services to help our clients plan, build and run their critical business initiatives. Through our range of quality-focused delivery models, we meet our clients where they are, and take them where they want to go, the way they want to get there.

TEKsystems. Our people make IT possible.

1The Henry J. Kaiser Family Foundation. Employee Health Benefits: 2008 Annual Survey. September 2008