Permie vs consultant vs contractor

May 31, 2006

For those of us plying our trade as coders in the City of London, or Wall Street, there’s a choice to be made about our mode of employment. Each of the three options has its own particular pros and cons. And if you’re to avoid a mismatch between your employer’s expectations, spoken and unspoken, and your own, it’s best to be clear sighted about those pros and cons. I’ve worked as permie and consultant. I’ve never been a contractor. But I do have a very strong preference for permanent employment. Here’s my take on the up and down sides…

  • Contractor
    • Pros
      • Good money
      • When times are good, you get to pick from a wide range of gigs, and to almost switch at will
    • Cons
      • When times are bad you can be out of work for a long time, and you may have to take a cut to get back in
      • You may not get much choice or influence over your work day to day
      • You’re unlikely to be in the room when the final decision is made
  • Consultant
    • Pros
      • Slightly more security than a contractor. This security can be illusory. During the last downturn lots of consulting firms canned staff pretty quick when the work dried up
      • You get to switch projects, like a contractor. But you may not have much choice over which projects your assigned to.
    • Cons
      • Money not as good as contracting
      • Negotiating the eternal conflict of interest between consultancies and their clients. The consultancy wants maximum duration and headcount from any project to maximise billing. The client wants the project done, and the consultants gone.
  • Permie
    • Pros
      • Security. If you’re any good at your job you should be more secure than consultants or contractors
      • Bonus: that’s why we’re working in the front office!
      • Influence: the chance to bring your own ideas, proposals and innocvations to the table. If you can get the business to sign up, you work on your own pet projects. To me, this is invaluable. Also, being in the room when the final decision is made.
    • Cons
      • Lack of change can be frustrating for the easily bored.
      • Sometimes you have to resign to escape a project you’re fed up with.

Sometimes advocates of consultancy represent it as combining the best of contracting and permie work. I fear that in many cases it combines permie compensation with contractor security.

I haven’t mentioned the distinction between working for a technology consumer org, like a bank, and a tech producer, like a vendor. That’s a topic for another day…

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4 Responses to “Permie vs consultant vs contractor”


  1. You forget the most important part of being a contractor or consultant …. sleep. When we go home in the evening, we leave all of our client’s troubles behind.

  2. etrading Says:

    You consultants may be able to forget your client’s problems, but can you forget your employer’s ?

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