Contract employment: Risks and rewards

Millions of people are searching for jobs today and one of the options available to many of them is to be a contractor. Contract employment has many benefits, but it also has many risks associated with it. Let's look at the risks and rewards of contract employment to help you understand whether being a contractor is for you.

No guarantees are associated with contract employment. For many, this is risk that they are simply not willing to take. Most people are depending on a regular income and for them, contract employment may not be an option. 

Contract employment often means you risk being part of the first ones laid off during economic downturns. Contract employment comes with no guarantee of continued employment, you may be let go at any time for any reasons. Here are some reasons to consider contract employment

  • Plenty of work - most contract employment opportunities broaden your horizons. If one client is pleased with your work, they often refer other clients to you. This can help you grow your business while your reputation grows.
  • Making your hours - one of the best rewards of contract employment is the flexibility of creating your own hours. Many elect for contract employment for this very reason. Having the ability to decide when you will and won't work is one of the rewards that often is the catalyst for making the transition to contract employment.
  • Working at home - while many people strive to reach a point in their careers where they can work in the privacy of their home, for many, contract employment is the ideal situation. Contract employment often means that you don't have to be tied to a "regular schedule" and that you can work either at an office or from the privacy of your own home. 

Risks Vs. Rewards

A lack of benefits is one of risks that many are aware of when considering contract employment. Those who elect this route will be responsible for medical benefits, life insurance benefits, prescription benefits as well as their own retirement accounts. This may be one of the biggest risks of contract
employment. Most people want to know that they have these benefits if they ever need them. For those who elect for contract employment, they are solely responsible for these types of benefits and often the cost associated with them is great.

Many people require structure in their day to day working lives. If you are one of the millions who elect for contract employment, you must be prepared for an ever-changing role with little (if any) structure. This is a risk that is commonly associated with contract employment and for some, this is risk they are not willing to assume.

One of the biggest risks of contract employment is the lack of feeling like you belong anywhere. While you may have contracts with a number of clients, often these contracts are short-term and this may prevent you from developing long term relationships with co-workers. Those who decide that contract employment opportunities are right for them often find that fellowship in other areas of their lives.
There are great rewards that are associated with contract employment. The lack of politics in the workplace, being accountable to themselves, having the flexibility to turn down an assignment are high on the list of rewards of contract employment. The most successful contract employment opportunities offer these additional benefits:

Contract employment is not for everyone. The risks and rewards of contract employment are many and are varied. You should carefully consider all of the risks and rewards before deciding that contract employment is right for you.