It’s no secret that we’re in the middle of a national talent shortage. And, unfortunately, the data seems to indicate that we’re in this for the long haul.
According to new research from Korn Ferry, there will likely be 85 million jobs unfilled between now and 2030 due to talent shortages, creating over $8.5 trillion in unrealized revenues during that time period.
This is true not only across the board, but also in specific sectors:
- Automotive. The U.S. will be short approximately 642,000 automotive, diesel, and collision technicians by 2024 if current trends hold, according to a new study by TechForce Foundation.
- IT & Tech. The latest U.S. labor statistics indicate that IT saw 1.4 million unfilled jobs at the end of 2020, with only 400,000 qualified candidates graduating each year.
- Financial Services. According to Cerulli Associates, retirement is on the horizon for the majority of wealth advisors, as the average age is 51 and 43% are over the age of 55. In contrast, just 10% of wealth advisors are under the age of 35.
In the past, many of these companies would provide 1-2 year contracting opportunities for new employees, enabling them to get some time working for the company before they commit to a full-time role.
However, thanks to these massive talent shortages, many of these companies are skipping the “test” period and offering more full-time hire roles.
You may be thinking: That’s great! A full-time role is better than a contractor role, right?
Well, it depends.
There are certainly plenty of advantages that come with a full-time role. However, there are other unique benefits that happen when you work as a contractor.
Here are some of the reasons why you should seriously consider contract work when jumping to your next opportunity.
Wage & compensation increases.
Generally speaking, highly skilled contractors can receive greater compensation than those who choose a standard career path. Because employers aren’t on the hook for paying for taxes or benefits, they’ll often offer a more competitive wage. And since contractors have to pay a self-employment tax and cover their own benefits, they’ll demand that higher wage as well.
In many industries, especially automotive, engineering, IT, and finance, there’s another factor at play: the temporary nature of contract work. It’s common in these industries for employers to look for experienced leaders with deep expertise and leadership to shepherd temporary (e.g. 12-24 month) projects.
However, because they can’t guarantee additional work after that, they’re willing to pay a premium to attract highly competitive talent.
Finally, because contracting consists of an hourly rather than full-time wage, there’s a strong possibility that you’ll be working some overtime hours.
All in all, the financial bottom line of working as a contractor is very positive for experienced professionals, which is why you should consider it as an option for your next career step.
Direct hire roles aren’t inherently more stable.
One of the common objections to contract roles is that there’s a tremendous amount of direct hire opportunity out there that you’re competing against. Many roles seven to eight years ago that were exclusively contractors are now direct hire.
For candidates, there’s a clear reason why a direct hire role beats a contractor position: direct hire roles provide career stability, while contractor roles do not.
But the numbers just don’t bear that out.
According to the Bureau of Labor Statistics, the average tenure of a full-time employee in a given job was 4.1 years, as of January 2020. Given the massive hits that companies took post pandemic, we can probably safely assume that this number is much lower now.
And according to our own research here at Brightwing, 54% of the professionals we surveyed believe that job security is either rare or a myth entirely.
The point is: a full-time, direct hire role isn’t going to provide the long-term security that you’re looking for necessarily. So that should be enough to at least keep the possibility of working as a contractor open.
Contracting may lead you to your dream company.
If there’s a certain company that you really want to work for, contracting may be the best way to get your foot in the door.
Although many companies are shifting to more direct hire roles, there are still a number of benefits they get from hiring contractors:
- A test period to make sure that they’ve brought on the right person before making a long-term commitment
- Fewer costs (training/onboarding, benefits, unemployment, etc.)
- Flexibility (on both sides of the equation)
- A development period to see if a candidate can grow into a particular role if they’re short of a few skills
If you rule out contracting roles altogether, you’re probably going to end up missing a great potential opportunity.
Final thoughts: You’re not in this alone.
Before we wrap things up, it’s important to note the main reason that people take a full-time role: the benefits.
Indeed, although there are plenty of compelling reasons to go out on your own, it’s hard to turn away the health insurance, vision, dental, vacation time, 401k, and more.
That’s one of the reasons that Brightwing works to provide that necessary support to our contractors. If you work with us, we provide all of the necessary benefits so your life can remain on solid footing.
On top of that, we also have people actively searching on your behalf for new opportunities. So when one contract comes to a close, you’ll have another one teed up and ready to go.
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