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Relatively few engineers actually want to do contract work. The day rates look high, but they have to pay self-employment taxes and health insurance, as well as

Relatively few engineers actually want to do contract work. The day rates look high, but they have to pay self-employment taxes and health insurance, as well as charge more to cover inevitable gaps between contracts. It seems unlikely that the existence of contract work is preventing senior engineers from joining your company. To be blunt, it’s more likely that you’re simply not paying enough to be competitive or you’re not an attractive place to work. Without knowing more details about your specific situation, the obvious change would be to simply offer more compensation. Higher compensation can make an unattractive job more attractive.

willcipriano 6y ago
Contract is a instant no for me. I've done the math and haven't found them to be competitive long term after what the above commenter mentioned (and that's before all the headaches of actually getting paid). Most of my peers feel the same way.
- cookguyruffles 6y ago
  You cannot put a price on career-long isolation from office politics
  - ghaff 6y ago
    Instead you have politics at the companies hiring you.
  - bavell 6y ago
    This is one of my favorite parts about contracting... you still have to deal with a little bit of office politics and drama but you're mostly shielded from it. I love dropping in once a week or so, greasing the relationship wheels, and getting the heck outta there.
- sam_lowry_ 6y ago
  I contracted for 10 years, then switched to a full-time job at a unicorn. Salary-wise, I calculated my yearly netto for the last contracting year, and submitted it to the HR as the netto salary I want to have. They approved in a blink of an eye. The main problem with contracting is lack of career path and random, not very interesting projects where the contractor has little say. The downside of employee life is non-technical meetings, personality trainings and yearly reviews. They make me feel like a kid. I also miss the luxury of buying VAT-free tax-deducible gadgets.
  - stewx 6y ago
    What is personality training?
    - sam_lowry_ 6y ago
      We had a dumbed down MBTI offspring. And a security training. And the bias/unconscious bias/unknown bias training. And a few more that I can not remember.
  - qorrect 6y ago
    > I also miss the luxury of buying VAT-free tax-deducible gadgets. Like what kind of gadgets ?
    - sam_lowry_ 6y ago
      Bikes are the most interesting. 120% deductable where I live. Notebooks, phones, various hardware. I have half a dozen Mikrotik routers, for example. Some serve their purpose at home, others are for playing.
- Nursie 6y ago
  Which country?
- JoeAltmaier 6y ago
  Been contracting for decades. Wouldn't do it any other way. The critical thing is to get a pipeline of folks you know that send work your way. So rarely idle. That was done by working 15 years in the field in a variety of companies. I keep in contact with many old colleagues and remind them I've got bandwidth. I never made more money than I do contracting now. I've never had to 'chase down money' - never had a bad check, never been stiffed. Had some late checks for sure. Probably due to the quality of my contacts.
  - deliriousferret 6y ago
    What kind of day rate do you manage to pull?
    - JoeAltmaier 5y ago
      It depends. Some midwestern companies want to pay < $100/hr. Californians will pay up to $145/hr for special skills. New York is accustomed to outrageous fees. I feel bad about taking advantage them so I only go up to $165/hr or so. And of course for assurances about hours and duration of the project, discounts.
whalesalad 6y ago
Funny - I’m the opposite. I’d much rather make my great rate doing indie work and helping lots of people versus being stuck in one role with a fixed salary and limited mobility.
Nursie 6y ago
> Relatively few engineers actually want to do contract work. The better contractors I've worked with all do, here in the UK. The day rates are high. The taxes are the same or lower, health insurance is optional. There's some company insurances you need and you have to get an accountant, but all-in that should be covered by less than a week of work each year. Gaps between contracts are desirable! Having a whole summer off to live on your accumulated war chest and chill out, it's amazing. Plus jumping on to a new project every few months keeps the work interesting, rather than stagnating at the same desk for years on end.
- stewx 6y ago
  Asking a contractor if they like doing contract work is a bit like asking someone at McDonald's if they like hamburgers. The answer is pretty likely to be "yes".
  - Nursie 6y ago
    No argument here! I'm just taking (minor) issue with the assertion that relatively few engineers want to do contract work. If that were the case you'd expect some contractors to wish they were perm. I think the benefits I outlined are such that quite a few do want to. I've also run into quite a number of perm folk over the years who want to do it but don't quite have the confidence in their own skills to make that leap. I was one of them!
    - nsonha 6y ago
      you can start by working in consulting
- jameshart 6y ago
  I mean, it’s not surprising that people who are doing well in the contract market like the contract market. For my part, I literally left the UK in part because the industry there was so geared towards contract work or boutique contract houses as the only viable career path for senior developers. It’s just not for everyone. I like staying with a product team and building and owning stuff; I like companies that build their technology in-house rather than outsourcing; I like being able to shape what the technology team contributes to the business rather than respond to already-baked RFPs. I like stock-based comp. The UK tech job market is very well suited to certain kinds of developers and certain kinds of relationships between businesses (and frequently government organizations) and their technology providers. It’s not the only way though.
dominotw 6y ago
yes exactly. I did contracting when i was single and young. Contracting requires you to tolerate random loss of income, paying health insurance yourself ( in usa), traveling, unpredictable work schedules. Its impossible to afford health insurance for the family, traveling ect when you have kids.
- bavell 6y ago
  This is currently me. There's no shortage of work and the pay is good but I think I'll need to shift gears to start a family. I don't travel much so that helps but you're spot on about healthcare and the unpredictable nature of this work.
- coldpie 6y ago
  > ect It's "etc". Short for "et cetera". https://en.wikipedia.org/wiki/Et_cetera https://en.wikipedia.org/wiki/Et_cetera
x86_64Ubuntu 6y ago
I'm with you. As a QlikSense developer, almost all jobs I see are Contract-To-Hire. The rates look good, but they aren't good enough to justify me having to get my own health insurance, nor do I want to risk 6-months of nothing happening for a full-time position I may not want in the end.
jackcosgrove 6y ago
> To be blunt, it’s more likely that you’re simply not paying enough to be competitive I get a lot of cold emails from recruiters and the jobs always seem to pay the same rate, which is no better than what I make.
runT1ME 6y ago
> The day rates look high, but they have to pay self-employment taxes and health insurance Most SWEs doing 'contract work' aren't actually 1099 contractors, what it means is they work for an intermediary and then 'contracted out' to a big company with a recognizable name (Google/BofA/Verizon/IBM). These jobs are W2 so you don't pay self-employment tax, they usually have mediocre insurance options, and you lose your job as soon as the work dries up. It's simply a way for a company to staff up quickly without going through as strict of hiring committee and having any obligation to keep said staff around if plans change. It's often easier for a department to get a req for a senior/staff contractor (and make salary exceptions) than a FTE, so what happens is departments will offer 200, 250 an hour for temp work but only able to hire engineers for 150k a year because their 'employee' req is slotted lower.

willcipriano 6y ago

Contract is a instant no for me. I've done the math and haven't found them to be competitive long term after what the above commenter mentioned (and that's before all the headaches of actually getting paid). Most of my peers feel the same way.

cookguyruffles 6y ago
You cannot put a price on career-long isolation from office politics
- ghaff 6y ago
  Instead you have politics at the companies hiring you.
- bavell 6y ago
  This is one of my favorite parts about contracting... you still have to deal with a little bit of office politics and drama but you're mostly shielded from it. I love dropping in once a week or so, greasing the relationship wheels, and getting the heck outta there.
sam_lowry_ 6y ago
I contracted for 10 years, then switched to a full-time job at a unicorn. Salary-wise, I calculated my yearly netto for the last contracting year, and submitted it to the HR as the netto salary I want to have. They approved in a blink of an eye. The main problem with contracting is lack of career path and random, not very interesting projects where the contractor has little say. The downside of employee life is non-technical meetings, personality trainings and yearly reviews. They make me feel like a kid. I also miss the luxury of buying VAT-free tax-deducible gadgets.
- stewx 6y ago
  What is personality training?
  - sam_lowry_ 6y ago
    We had a dumbed down MBTI offspring. And a security training. And the bias/unconscious bias/unknown bias training. And a few more that I can not remember.
- qorrect 6y ago
  > I also miss the luxury of buying VAT-free tax-deducible gadgets. Like what kind of gadgets ?
  - sam_lowry_ 6y ago
    Bikes are the most interesting. 120% deductable where I live. Notebooks, phones, various hardware. I have half a dozen Mikrotik routers, for example. Some serve their purpose at home, others are for playing.
Nursie 6y ago
Which country?
JoeAltmaier 6y ago
Been contracting for decades. Wouldn't do it any other way. The critical thing is to get a pipeline of folks you know that send work your way. So rarely idle. That was done by working 15 years in the field in a variety of companies. I keep in contact with many old colleagues and remind them I've got bandwidth. I never made more money than I do contracting now. I've never had to 'chase down money' - never had a bad check, never been stiffed. Had some late checks for sure. Probably due to the quality of my contacts.
- deliriousferret 6y ago
  What kind of day rate do you manage to pull?
  - JoeAltmaier 5y ago
    It depends. Some midwestern companies want to pay < $100/hr. Californians will pay up to $145/hr for special skills. New York is accustomed to outrageous fees. I feel bad about taking advantage them so I only go up to $165/hr or so. And of course for assurances about hours and duration of the project, discounts.

whalesalad 6y ago

Funny - I’m the opposite. I’d much rather make my great rate doing indie work and helping lots of people versus being stuck in one role with a fixed salary and limited mobility.

Nursie 6y ago

> Relatively few engineers actually want to do contract work. The better contractors I've worked with all do, here in the UK. The day rates are high. The taxes are the same or lower, health insurance is optional. There's some company insurances you need and you have to get an accountant, but all-in that should be covered by less than a week of work each year. Gaps between contracts are desirable! Having a whole summer off to live on your accumulated war chest and chill out, it's amazing. Plus jumping on to a new project every few months keeps the work interesting, rather than stagnating at the same desk for years on end.

stewx 6y ago
Asking a contractor if they like doing contract work is a bit like asking someone at McDonald's if they like hamburgers. The answer is pretty likely to be "yes".
- Nursie 6y ago
  No argument here! I'm just taking (minor) issue with the assertion that relatively few engineers want to do contract work. If that were the case you'd expect some contractors to wish they were perm. I think the benefits I outlined are such that quite a few do want to. I've also run into quite a number of perm folk over the years who want to do it but don't quite have the confidence in their own skills to make that leap. I was one of them!
  - nsonha 6y ago
    you can start by working in consulting
jameshart 6y ago
I mean, it’s not surprising that people who are doing well in the contract market like the contract market. For my part, I literally left the UK in part because the industry there was so geared towards contract work or boutique contract houses as the only viable career path for senior developers. It’s just not for everyone. I like staying with a product team and building and owning stuff; I like companies that build their technology in-house rather than outsourcing; I like being able to shape what the technology team contributes to the business rather than respond to already-baked RFPs. I like stock-based comp. The UK tech job market is very well suited to certain kinds of developers and certain kinds of relationships between businesses (and frequently government organizations) and their technology providers. It’s not the only way though.

dominotw 6y ago

yes exactly. I did contracting when i was single and young. Contracting requires you to tolerate random loss of income, paying health insurance yourself ( in usa), traveling, unpredictable work schedules. Its impossible to afford health insurance for the family, traveling ect when you have kids.

bavell 6y ago
This is currently me. There's no shortage of work and the pay is good but I think I'll need to shift gears to start a family. I don't travel much so that helps but you're spot on about healthcare and the unpredictable nature of this work.
coldpie 6y ago
> ect It's "etc". Short for "et cetera". https://en.wikipedia.org/wiki/Et_cetera https://en.wikipedia.org/wiki/Et_cetera

x86_64Ubuntu 6y ago

I'm with you. As a QlikSense developer, almost all jobs I see are Contract-To-Hire. The rates look good, but they aren't good enough to justify me having to get my own health insurance, nor do I want to risk 6-months of nothing happening for a full-time position I may not want in the end.

jackcosgrove 6y ago

> To be blunt, it’s more likely that you’re simply not paying enough to be competitive I get a lot of cold emails from recruiters and the jobs always seem to pay the same rate, which is no better than what I make.

runT1ME 6y ago

> The day rates look high, but they have to pay self-employment taxes and health insurance Most SWEs doing 'contract work' aren't actually 1099 contractors, what it means is they work for an intermediary and then 'contracted out' to a big company with a recognizable name (Google/BofA/Verizon/IBM). These jobs are W2 so you don't pay self-employment tax, they usually have mediocre insurance options, and you lose your job as soon as the work dries up. It's simply a way for a company to staff up quickly without going through as strict of hiring committee and having any obligation to keep said staff around if plans change. It's often easier for a department to get a req for a senior/staff contractor (and make salary exceptions) than a FTE, so what happens is departments will offer 200, 250 an hour for temp work but only able to hire engineers for 150k a year because their 'employee' req is slotted lower.