So as many of you know, round about last year I decided to give the consulting thing a go – possibly permanent. I’d gotten tired of turnovers, layoffs, transformations, reorgs, politics, etc. I took a 5% pay cut – and a return to 40 hour weeks – and gave it a shot.
The end result is I actually liked it. Now let me note that I’m not giving up being a permanent employee (or my own business if anything works out). My take was that if any contract resulted in an offer and I figure it’d work out since I’d been at the place awhile, I’d take it. And, of course, if I stay a contractor who knows where I’ll be business-wise.
(I’d say of the places I’ve contracted at over the last 20 years, about one out of 4 were “worth making permanent” – they were all good, but some didn’t have the right opportunities).
But, still, for now and the foreseeable future I’m doing the contracting thing. And there’s a lot to share.
Here’s what I’ve experienced with my shift to going contractor.
Medical Benefits: Not as big a pain in the backside as you’d think – many placement companies provide them, if only medical. The big issue may be jumping between companies, so you’l need to stay on top of this, occasionally do short-time COBRA, or just go for your own. It’s not horrible, but it’s a bit of work, and Obamacare makes it easier for many.
Other Benefits: Many contracting companies that focus on professionals offer people on longer-term assignments some pretty nice deals. You may just have to bounce that 401K around (have your own investment plan)
Pay: Here’s where it gets interesting. As a contractor I get paid hourly, and tend to work around 40 hours a week. I also don’t get bonuses or stock usually. But I found compared to being a regular employee I get an enormous amount of time back -and when that overtime comes in its pretty impressive. Technically I’m making more per hour as a consultant considering that unpaid overtime of other jobs (stock and bonuses included)
Working With The Companies: If you’re selective, you’ll find most contracting companies you go with are good – and there’s a lost of god ones, especially in IT. Most people are pretty chill, and if you do it right you can line up multiple assignments in a row – though be careful with time of year. Speaking of . . .
Timing Is Everything: Openings are cycler, which can be a pain. I had to switch companies due to work availability as my last contract ended before Thanksgiving. My new and my old company were both awesome, fortunately. However you need to know cycles in your industry. Also have some liquid cash around for having a few weeks off here and there.
Train Yourself: One thing you may not get is training support and reimbursement, so that’s up to little old you to do. That can be a pretty big chunk of change. However . . .
Rates Can Be Generous If You’re Smart: Right now I’m making a decent wage for a good job, but you have to be smart and not get lowballed. If you’re skilled and smart, you can break the average, and there is room for negotiation. I’ve interviewed for some seriously crazy hourly amounts.
You Have To Have a Pitch: A good consultant has to know how to pitch themselves. If you’re not going to do that it might not be for you – unless you get a really good representative.
People Treat You As Competent: One thing I’ve noticed over my years of contracting is that people usually give contractors more of a benefit of a doubt than employees. This isn’t true of everyone, but I find it’s true more often than not. For some people this can be very refreshing if, say, they had a bad layoff.
It Is a Career: A lot of people in Silicon Valley have a consulting phase of life, and some people will make it their career. You can do this all/most of your career – if you plan. People eve respect it.
It Can Help In Retirement: If you’ve been a consultant, then it’s a great retirement plan. You can work smaller projects, intermittently, etc. If you get good at it, you’ve got something to use into old age – I meet people consulting in their 70’s (and raking in a nice wad of cash)
It’s A Bit Of A Pain On A Resume: As you may have many short assignments this gets tough. I keep a history of resumes, and put the most detail on the latest.
That’s my experience. Hope it gives you some ideas!