An issue for many professionals is whether to work in a permanent job or in a freelance/contract capacity. The freelancing option is becoming increasingly popular. Figures from the Professional Contractors Group show an estimated 1.4 million freelancers across all industries in the UK, with a 14 percent growth in the last decade.
If you are considering which of these career paths to follow, it’s best to weigh up the benefits of both and then consider which option most suits your circumstances and skills set.
A Permanent Career
Working in a full-time, permanent position will bring you the benefit of financial security. Making staff permanent is an advantage for employers as well as for employees. Organisations like to plan for the future secure in the knowledge that staff will not leave at short notice. Employers do not like to lose valuable employees, so if you are good at what you do, there should be opportunities for you to advance. Other advantages include:
Holiday pay: You will be entitled to paid holidays, as a permanent employee. Also, companies will have sick-leave schemes in place.
Workplace camaraderie: Working in a team and having the opportunity to develop friendships with colleagues can bring greater job satisfaction.
Pay security: Knowing when, and how much, you will be paid each month means you will be able to plan your finances and have greater day-to- day peace of mind.
A Contract Career
A word that stands out when discussing contract careers is flexibility. It means being able to work for the type of company you want to work for when you want to, and being able to draw on your skills.
The flexibility of freelance work also means being able to achieve a greater work-life balance when compared with a permanent position. Other advantages include:
A gateway to greater things: If you are re-entering the workforce after an absence, contract work is a great way to build up experience before taking on a more permanent role. Contract work also enables you to gain exposure to a new sector or industry.
Financial benefits: As a contractor, you can offset certain work-related expenses against taxable income. This is where the services of an umbrella company come in useful. Taking on the role of an employer for agency contractors, an umbrella company, like Crystal Umbrella, will issue invoices to the relevant agency or client and when payment is received, pass it on to you, the freelancer. The umbrella company offsets business expenses against tax, which has the effect of rendering this element of your income non-taxable. Removing the administrative burden of accounting for expenses is another benefit. An umbrella company can give you advice on how the concept works.
Choosing the right career structure means balancing your priorities, as well as evaluating your strengths and weaknesses, before deciding whether a permanent or contract path is the right one for you.