The International Monetary Fund (IMF) says the UK economy will be the fastest-growing among the “G7” nations this year. In order to capitalise on this growth, many employers in the UK will need to source new talent and different skill-sets. This return to growth is great news for everyone, but especially so for contractors.
EVENING STANDARD: Tuesday, 8 April 2014
Why it’s great to be your own boss
The economic downturn has left more of us yearning for flexibility and to take more control of our lives. That’s why being a contractor is appealing to so many, by Niki Chesworth
Flexibility over when and where you work. Variety, with a new role every nine months to a year, and higher pay. It is no wonder that contractors enjoy what they do.
A contractor is an individual professional who agrees to provide his or her expertise to a company to complete a specific project, often within a fixed period of time.
While they do not benefit from the same rights as employees — such as holiday accrual or pension payments — in return, they are often paid at a higher rate than permanent employees, with the ability to work flexible hours or to move on to a new contract when it suits them.
With key specialist roles hard to fill, there is a huge demand for contractors with a new Robert Walters white paper on the value of contractors revealing that 76 per cent of employers are using them to bridge shortages of skilled/specialist staff. The second-most common reason to hire contractors is that they are a cost-effective way of fulfilling a fixed-term project, cited by 47 per cent of those surveyed.
Most contractors are paid daily rates, with the most desirable contract term between nine months and a year. However, smaller firms are more keen to pay fixed-term salaries, which can be more open-ended.
Employers are not doing themselves any favours when it comes to hiring the best talent, with more than half taking three weeks or more to hire. “An overly lengthy recruitment process can serve both to deter candidates and make a competitor’s offer seem more appealing, even for roles less lucrative or fulfilling,” warns Andrew Broster, director at Robert Walters.
There is a difference between what women and men want from being a contractor, with 58 per cent of women listing the flexibility of when and where they work as a key draw, an opinion shared by only 45 per cent of men.
The survey also revealed that the ability to leave a contract early is more likely to appeal to female contractors, while men find greater control over personal taxation a more attractive draw than for women.
Also, being a contractor is not without problems. Despite a reliance on contractors by many employers, nearly four in 10 complain of poor communication with colleagues and managers, and more than two-thirds have had problems logging into IT systems early in their contract. More than four in 10 have also encountered problems with accessing information of critical importance to fulfilling the project. A third of those working for larger employers also say they have not been given a clear project briefing.
In addition, four in 10 have also turned up on their first day only to find a workstation, desk or chair unavailable.
Isolation is another issue although many contractors say they do not expect or even want to work closely with others.
Contractors may only be working for an organisation for a few months, but employers are careful about who they hire. Contractors, apart from those on very short-term contracts, can expect to be invited to at least two interviews.
Such is the demand for specialists that employers are increasingly using recruitment consultancies for matching skills with the right role. More than eight out of 10 employers and contractors agree that their preferred hiring channel is a recruitment consultancy, although just over half of contractors use personal networks (54 per cent) and nearly three in 10 (27 per cent) prefer to use direct applications to business.
“Though hiring channels have been steadily proliferating in number, the evidence shows that a majority of contractors still prefer the advice of a recruitment consultant,” says Colin Loth, director at Robert Walters.
Free to move on
While employers like the flexibility of being able to bring in a skilled specialist for a short-term project, contractors are less committed.
More than half of contractors surveyed said they have left a contract early at least once — and this is more likely if they are paid an hourly rate.
And it is money that encourages them to move on. Half of employers feel that remuneration is the top reason for breaking a contract.
The most loyal contractors are secretaries and office support staff, followed by those working in treasury and human resources. The least loyal are those specialising in change management, banking and finance services and compliance.
Why become a contractor
• High rates of pay – 51 per cent
• Flexibility to determine when and where to work – 50 per cent
• Freedom to mange own finances and tax affairs – 40 per cent
• Experience of different industry sectors and businesses, with no need to commit – 36 per cent