STRATEGIC SOURCING/PROCUREMENT * SUPPLY CHAIN * PLANNING & OPERATIONS * CONTINUOUS IMPROVEMENT (Six Sigma) * PROJECT MANAGEMENT * ANALYTICS
It’s estimated that by 2030 that up to 50% of the global workforce will likely be contingent. Seriously! We see it in the news every day. In the last 48 months for example, the ratio of open contingent jobs to permanent positions has balanced at about a 60/40 split where it used to be very much weighted in favour of permanent staffing. That is a radical change.
The world is certainly a much more mobile place, more connected, much more knowledge-based, and professional and executive contract staffing is definitely an important part of that trend. Chances are you already know someone who is already enjoying the advantages of being a contractor.
Similar to what happened in IT & Engineering twenty years ago, organisations are seeing contract and project-based professional staffing as a major key to their go-forward procurement – supply chain initiatives. Still entrenched in traditional values, the concept of contract-based work still carries an unfortunate twinge of transience to some professionals who are used to the safety of their permanent careers. BUT, Things have changed a lot in business – we all know the leaps that have happened in thirty years with technology which have resulted in dramatic changes trending in employment. Certain job categories have died where others have boomed, longevity of employment has shortened significantly – no-one gets rewarded for staying at a company for 15 years anymore for example.
Contract/Consulting/Contingent is becoming a way of life for professionals who, five or so years ago would never have considered it. Professionals (in Supply Chain, Operations, Six Sigma and Strategic Sourcing for example) used to think that contract offered less stability than permanent employment. But demand for Contractors in these particular verticals is sharply on the rise, and it is on a steep trajectory. Today Contract work is a rewarding and viable long term option for professionals and it is easier than ever for skilled SCM professionals to make fantastic careers in a Contingent vs. permanent line of work. It’s ‘old hat’ to think of contract as a stopgap measure on the way to full-time employment. So why are more and more Strategic Sourcing – Supply Chain – Procurement experts finally seriously contemplating and actually making the leap to the contract lifestyle?
There are certainly some obvious benefits to the Contract/Contingent lifestyle. In today’s knowledge-based economy, Contracting is a GREAT opportunity to do excellent strategic work in a number of industries, for a variety of interesting projects. It’s the best way to expose yourself to diverse industries, people, processes, systems, methodologies, organizational culture, skill sets, and management styles, and to learn from and network with as many people as possible. If you stay in one position too long, your skills might atrophy. But if you choose the contract lifestyle, you’re always gaining the latest and new skills and experiences. Many people report that their careers were at their most productive and instructive when they were switching between jobs often and picking up new ideas. Contract lets you get this diversity of work experience without the stigma of being a “jumpy” candidate who can’t stay in one place.
Contracts are huge money makers as well as career makers. For example, companies will pay 20% to 50% more for skilled Procurement/Strategic Sourcing, Project Management and Change Management Professionals contractors than they do for their permanent counterparts. Why? Because the money comes from a different pot than permanent payroll and Contract work has always paid a premium and the company does not have to bear the additional expense of benefits and such so there is more room to put the money right into the individual’s pocket. And because the contract has an end-date, the company knows that their expenses will be limited if they do not wish to extend the contract (although our experience is that most contracts do get extended past their initial date). And, the contractor goes on to new contracts afterward and keeps making great dollars.
There are also other advantages to being a contractor: There is the possibility to Incorporate as a business or to become a Sole Proprietor. Incorporation and sole proprietor status has its obvious benefits to minimize taxes which can be highly beneficial. That’s something one rarely benefits from in a permanent position. It makes a huge difference. A sole contributor without direct reports in Strategic Sourcing can immediately increase their compensation by over 25% by making the switch to Contract which is an exciting proposition and that is hard to match with pay equity in most company.
Additionally, with today’s business and life stresses, better work/life balance is highly valued. And something very attractive that contract work easily provides. Work/life balance is becoming one of the most important commodities in the 21st-century economy. While you’re expected to deliver results and impact the bottom line of your employer during each contract, the fact is that contract opportunities allow you to be more flexible in-between contracts, which allows you to take more control over your career and your life. You can take the extra money that a lucrative contract position provides and take time to travel or work on personal projects (perhaps a new business venture of your own) before taking on the next big contract.