The Disadvantages of Being an IT Contractor
In the last couple of years thousands of people have made the decision to switch from fixed IT employment to IT contracting. On the face of it this is an exciting career change with massive potential, and recent figures from the latest KPMG / REC (Recruitment and Employment Confederation) report in the UK are encouraging for IT contractors, showing that whilst the permanent jobs figures are looking more and more troubling, IT contracting is one of the few areas to show significant growth. This was because the shortage of contractors in IT and engineering with certain skills was still acute and these contractors are in great demand.But if you are thinking about moving into IT contracting it is worth giving serious consideration to whether the lifestyle will suit you. Obviously the advantages can be significant, from increased financial rewards to flexible working hours and (and the chance to spend more time with friends and family) to the ability to work in a field you love, for yourself (there is no better feeling than being your own boss) and to shape the direction of your career by choosing which projects you take on. As an IT contractor you can choose to specialize in certain areas or you can develop a broad range of skills, depending on what you’re interested in.However, before you make the leap it is always worth considering worst case scenarios and to look at some of the possible negatives of a freelance IT contracting career.Firstly, you need to ask yourself if you are disciplined enough. When you freelance, there will be times when you have to work from home, or from a home office. Indeed in the modern interconnected world we live in there are many IT contractors who only work from home, taking jobs from all over the world via one of the many freelance job sites. If this is the case, you need to ask yourself if you will be able to get on with the job with no boss, or fellow employees to look over your shoulder and check you’re working. Have you got the discipline to say no to partners / kids / friends when they want your attention. Can you set yourself a number of hours which are for work and convince those around you that you absolutely cannot be disturbed in those hours? If you cannot, or you are easily distracted, then you should reconsider IT contracting.This leads to the second point, that because you are your own boss and are starting out on your own, you also need to be disciplined about finding work. Work will not arrive at your doorstep. As an IT contractor you are going to need to be extremely proactive in going out and finding IT jobs, whether online or in the real world. This will involve self-promotion and networking, which for many IT workers is not something that appeals.Thirdly, you need discipline because you are the only one who is liable for the job. One of the disadvantages of IT contracting is the same as one of the advantages. The buck stops at your door. It is your reputation on the line, your work that needs to be perfect every time and your business that will suffer if you do a bad job, or worse, find yourself having to deal with a troublesome client.Finally, you need to think about the possible financial consequences. Certainly there are much better financial rewards for contractors, but what about if you cannot find work? Are you prepared for weeks or months without a client, and more particularly, are you prepared for a rough first few months as a contractor? IT contractors, when first starting out can often face long periods before getting their first job. When working via online job boards for example, IT contractors are normally granted projects based on their feedback for previous work. As such when you are first starting out it might be necessary to bid very low on projects, just so you can start to build some feedback.For this reason, IT contractors should have savings put by for the first few months, and thereafter always save a small amount from your earnings in case there are lean periods again. When it comes to financial matters contractors also face disadvantages from some financial institutions. Not only do IT contractors need to manage all their own accounts, taxes and contributions, which can be time consuming, but they might also face problems when trying for mortgages as most banks and building societies are notoriously reluctant to lend money to people who do not have a fixed income.Of course there are many well known financial advantages to IT contracting, from the higher rewards to innovative tax solutions such as Umbrella companies, Employee Benefit Trusts and excellent contractor pensions. If you are prepared to negotiate all the possible downsides, IT contracting can indeed be an exceptionally rewarding career choice.
