The current job market is full of various opportunities, no matter the type of employment you’re looking for. Two of the currently most popular types of employment include being hired full-time or contract work.
Needless to say, while both of these options do offer some unique benefits, deciding between the two will greatly depend on various factors. So, to make the best decision, you will need to determine your financial needs, think about the career and lifestyle path you wish to take and carefully assess the pros and cons of both of these options.
The easiest way to approach this matter is by exploring all of the unique advantages and disadvantages of both full-time job and contract work and comparing them to your own needs and expectations.
So, to better understand both of these types of employment, we’ve created an in-depth list containing the pros and cons of both of these options.
What is Contract Job?
The report of Intuit 2020 says that By the end of the year 2020, 40% of US employees will be contract workers.
As the name itself suggests, contract work is any type of work you sign a contract for. Most commonly, this includes being hired on an on-demand basis. So, you will be hired for a specific project or during a pre-set time instead of being hired by your employer full-time.
The contract you sign is basically a written agreement between you – the contractor – and a company, business or an individual that’s in need of the type of services you provide.
It can sometimes happen that, as a contractor, you do get offered consistent work within a company, but this will only last a certain period of time.
As a contractor, instead of receiving a steady income, you will be compensated based on a rate you’ve previously negotiated for a particular project or based on the number of hours you sent on the job.
What is a Full-time Job?
Being hired full-time will require you to complete various job-related tasks on a consistent, daily basis. These tasks will be determined by your job schedule and the overall company organization, but it’s safe to expect you will have a more or less similar amount of work each day.
As a full-time employee, you will be expected to show up for work each workday at a specific, predetermined time, and you’ll need to stay in the office during your entire shift.
Moreover, full-time employees should expect consistent compensation for their work, based on factors such as their level of proficiency, the status within the company, as well as their work history, to name just a few.
Full-time employees most commonly work as a part of a team, which enables them to relate to other employees, build quality work relationships and get in touch with other professionals from similar fields.
Contract Job vs. Full-time: Quick Overview
Previously we’ve only briefly mentioned some factors that emphasize the difference between contract work and full-time employment. Now, we’ll dive a bit deeper into some of these main differences to try and provide a clearer picture.
- Most commonly offers flexible work hours
- Leaves room for choosing your clients
- Requires you to spend only a specific amount of time working – i.e. until you finish your workload for the day
- Employment can be found only when there’s a need for the services you provide
- Promises one-time or project-specific payment
- Will require you to find and invest in your own training and improvement
- Doesn’t include various company benefits
- Will require you to take care of taxes on your own
- Will require you to take care of taxes on your own
- Requires you to invest in your own equipment and tools necessary for the job – unless the contract states otherwise
- Will be compensated for only once the job is done and the client is happy with the outcome
- Involves a fierce competition
- Allows you to work remotely or from your own establishment
- Doesn’t offer financial coverage for holidays, sick leave and vacation
On the other hand, full-time employees can expect things to be quite different.
- Will require you to work during predetermined work hours
- Will promise work year-round
- Promises regular, steady income
- Enables you to partake in company-funded and organized training and improvement programs
- Will require you to complete only specific work-related tasks
- Offers company benefits
- Manages and takes care of taxes for you
- Offers access to necessary equipment and tools
- Doesn’t allow you to choose your clients
- Offers coverage for national holidays and sick leave
Also, we now may say that college degrees aren't strictly necessary nowadays. This recent adaptation of the job market has had an impact, especially regarding full-time positions. But in general, it depends on what the job is about and if demonstrable experience in the field is what brings in the results a company looks for.
With all of this being said, it’s now time to look at some of the most noteworthy advantages of both of these types of employment.
Advantages of Being an Independent Contractor
The most noteworthy advantages of being a contractor include but are not limited to:
The Ability to Set your Own Schedule
As we’ve mentioned previously, as a contractor, you can expect to get hired either for a specific project or during a specific period.
In order to understand this better, let’s look at a practical example. For instance, software development companies from NY may get hired only to create a specific software solution for their client. Or they may also be hired to maintain the software solution and provide constant updates.
Both of these instances will enable them to set their own schedule.
And while it is true that, as a contractor, you will need to meet certain deadlines, you are the one that has the freedom to decide when and how you’ll approach finishing your work.
The Ability to Choose Your Projects
Additionally, you will also have the freedom to choose your own projects. Initially, contractors that are still trying to “get their name out there” and grow their business won’t really have this commodity.
However, once you reach a certain level of success and manage to make a name for yourself, you can expect to be able to accept or decline projects as you see fit.
The Ability to Work for Multiple Clients Simultaneously
As a contractor, you can also choose to work for multiple clients simultaneously – some of which may even be direct competitors.
Here, the most important thing you need to ensure is that you’re able to handle all the workload you decide to take on and meet all the deadlines accordingly.
One of the most common mistakes contractors that are new in that line of business make, is taking on more projects than they can realistically handle. Needless to say, this can result in delays and failing to meet projects, which will make you come off as rather unprofessional.
The Ability to be in Charge of Your Finances
Since you’ll be able to decide how much work you wish to take on and how many different clients you wish to work for, you’ll also be able to control your finances.
This means that if you’re working for three clients simultaneously, for instance, you’ll be able to earn three times more than you would if you were working for a single client.
Thanks to this commodity, contractors can easily plan and organize time off or vacations and holidays by accepting more work prior to ensure that they’ll be able to handle them financially.
Advantages of Being a Full-time Employee
Even though the advantages of being hired full-time are quite different than those contract workers can expect, they can still be quite appealing. These include:
Once you get hired as a full-time employee, you can rest assured that you are guaranteed work.
For many people, this type of job security is quite appealing, as it means that they don’t have to search for work on their own. Instead, they will simply be working continuously within a company, fulfilling their specific role.
This type of employment and job stability is something many people strive towards, as it enables them to plan and supports specific lifestyles.
Since full-time employees are guaranteed work, they’re also guaranteed compensation for the work they perform.
This compensation usually comes in a monthly salary or fixed daily or weekly pay.
The best part of being eligible for a fixed income is that it allows you to plan since you’ll know exactly when and how much you are being paid.
Moreover, full-time employees are also eligible to receive various company benefits.
Many companies offer paid time off, healthcare, insurance, retirement plans and similar perks.
To many people, particularly those either planning or already having a family, this is one of the most vital advantages of being hired full time.
Access to necessary tools and equipment
Every company employee will have access to any tools and equipment they may need to get their work done.
What’s more, even if they identify that the company lacks the necessary tools or equipment, full-time employees can rest assured that they will most likely provide them sooner rather than later.
So, while contractors are required to obtain all of these – out of their pocket – company employees will either have them at their disposal or will need to file in a request to obtain them.
Covered training and improvement program
When they decide to hire people full time, most companies are also looking to invest in their employees additionally.
So, most commonly, full-time employees can expect to have access to various training and improvement programs that will enable them to perfect their skills and even pick up some new ones along the way.
As mentioned earlier, contractors, on the other hand, will need to take care of this on their own.
Contract vs. Full-time Job: How to Choose Between the Two?
While both of these employment types indeed promise significant advantages, the fact of the matter is that they do differ quite a bit. That’s why some people find it rather challenging to choose between the two and identify the employment type that will serve them best.
Although we can’t give you a clear answer regarding which one of these is a better option for you personally, we can provide some insight into a couple of factors you need to consider that may help you decide.
Identify your Long-term Needs and Goals
The first thing you need to determine is your long-term needs and goals. Here, you should think about both your financial and lifestyle needs. Keep in mind that:
- While contract work may yield higher wages, it doesn’t promise consistent work and thus doesn’t promise fixed income. What this means is that while your finances may be excellent at one point, you may find yourself struggling financially at the other. So, if financial stability is extremely important to you, full-time employment may be a better option.
- Flexibility is another key factor you need to pay attention to. If you simply can’t seem to fit regular work hours into your daily lifestyle, chances are that the full-time office job will not be the best match for you personally. Luckily, contract work offers great flexibility when work hours are concerned.
Assess your Skillset and Occupation
Depending on the type of work you do and the skill set you possess, you’ll be able to choose between the two employment options – for the most part.
However, there are still certain professions and occupations that don’t offer the possibility of choosing between the two, so you need to keep that in mind as well.
If you’re working in an industry or niche that allows you to choose, go for the option that will make it easier to improve your current skills and even expand them.
That way, you can quickly improve yourself professionally, which will only result in better job opportunities down the line.
Both contract work and full-time employment offer this possibility – each in its unique way.
Connect with Other Professionals
If you’re still unsure of which of these two options are better for you and you’re having a difficult time deciding, consider reaching out to other professionals from your industry.
The chances are that you’ll be able to gain far greater insights into both full-time and contract work advantages and disadvantages if you listen to other people’s first-hand experiences.
These will not only potentially help you reach a decision that’s better suited for you, but they can also help you create invaluable relationships with other industry experts that may offer you help or even mentorship down the line.
To sum up
If you find yourself looking for work but you can’t seem to be able to determine whether a full-time or contract job will suit you better, consider some of the perks mentioned above and the benefits of a contract job vs full-time.
Hopefully, by clearly defining and determining your wants and needs, you’ll be able to choose the preferred career path more easily.