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Permanent to contract: Is contracting for me?

Instinct does both permanent and contract digital recruitment. We place people in jobs we hope will last for years, and others on short-term projects that are planned for just for a few weeks.

We also help people make the transition from one to the other.

So today we’re starting a series of articles on precisely this topic, helping you figure out whether switching is the right thing for you to do next, and helping you get all the necessary practicalities in place.


First things first – how can you decide whether contracting is the right option for you?

It’s easy to see why contracting can be appealing. Moving from one project to the next means that workplace boredom is far less common. Day rates tend to work out as more lucrative for equivalent work than permanent salaries. Gaps between contracts can be allocated to exciting holidays – or simply rest and relaxation. And if a particular workplace doesn’t appeal, for whatever reason, it’s far easier to move on to something new.

But it’s still a big step.

Contract employment is clearly more flexible than permanent employment, but that flexibility comes at a price. Contracting is also far less secure than permanent employment. You get no paid holidays or sick leave, no guarantee that your contract will be extended for as long as you’d like (or that it won’t be unexpectedly called off), and no promises that you’ll be earning money every week of the year. Indeed, part of why contract work tends to pay better, hour on hour, than permanent work, is to absorb the inevitable gaps between contracts and the time you must spend on unbillable work – that is, your administration, finances and seeking out new projects.

The first step in deciding whether contracting is for you is weighing up these pros and cons, figuring out what is most important to you, and what your personality type and preferred ways of working can cope with. Are you happy to forgo some security for flexibility?


Next, think about the balance between your skills and experience, and the money you want to make. Contracting means taking far more responsibility for your budgeting and personal cashflow than a company employee. You’ll need to manage potential gaps between projects or quieter times of year, making sure you have enough money set aside to cope with them. You’ll also need to think clearly about how much money you want – and need – to make in a year, how that translates to a day rate and then – crucially – how realistic that day rate is. Don’t forget that a contractor year doesn’t consist of 52 earning weeks – you need to subtract your holidays, and estimate your sick days and downtime.

This is when speaking to a specialist contract recruiter can be particularly helpful, as they’ll give you an informed idea of the kind of day rate you can command, and how strong the market is for your particular skill set.

Many of the areas we work in, including e-learning and website development, have very well-established contractor markets in which strong candidates will always find well-paid work. More niche areas, or those with a strong management streak, may have a less active contractor base. You will need to offer a more standout skills set in order to secure them.

If contracting is still an appealing – and realistic – option after considering all these factors, then it’s time to start looking at the legal and financial practicalities – which is what we’ll be blogging about next time.