Pros & cons of Contracts
Contract vs. Permanent employment:
Before you jump from permanent to contract, consider this: It's easy to go from permanent employment to contracting, but very hard to go from contracting to permanent employment.
No one ever told you this, right? (Do your own research with hiring managers - ask them how many times they've hired someone with a lot of contracting in their background for a permanent position. We have and it doesn't happen often!)
Hiring managers think contractors have different mentalities than permanent employees. They believe contractors will not stay in permanent jobs for very long because they are used to: switching jobs frequently, working on short-term projects where they don't have to stay around and actually live with the long-term results of their work, making more money than permanent employees. And guess what? Our research does show that long-term contractors don't stay with companies for very long when they switch from contract to permanent, so these hiring managers are in fact right. Taking a contract from time to time is fine, but a steady diet of contracts will get you on the contract train and you won't be able to get off because no one will hire you into a permanent job.
Pro's for contracting: make 10-50% more money (if you can stay working), more work variety, oftentimes more challenging work, technical skills more likely to stay current, many contractors work only part of the year (taking 1-2 months off each year).
Con's for contracting: constantly looking for the next new projects can be mentally draining, lifestyle promotes a lack of balance between home life and work life, chances of progressing to upper management very limited over time (see next paragraph), lack of health insurance and other benefits can eliminate the extra money you thought you would be making as a contractor, no place to hang your hat and develop loyalty to (which is important for some people to have career satisfaction).
Contractors reap more money in the beginning but lose out in career progression over the long term because they get stuck in technical areas or only have short-term project management experiences and never have a chance to grow their careers and their thinking from inside company cultures. Many sr. level career paths inside companies can only be accessed as long as you stay on a career path from within companies as a permanent employee.
Many times people get into contracting because there aren't other opportunities available. If your personality is not suitable for contracting, then having to take a contract can lead you into a life that will make you miserable (we've seen it happen many times) because one contracting job can put you on the Contractor Merry-Go-Round that you can't escape from. Contractors who want to work as permanent employees should go into a contract by making it known to the company that they would like to become a permanent employee, if a job becomes available. Become an employee through contract-to-hire and be conscious of working 2-3+ years as a permanent employee from that day forward so as to solidify your permanent career path.