3 Ways IT Contractors Make More Money
12/02/20 by Motion Recruitment
IT contractors have long and lucrative careers just as successful as a salaried technologist, especially since there are many opportunities within contract or contract-to-hire roles that others overlook. What makes a contract role different from a full-time hire position? One of the biggest benefits of a contract position is also the largest decision-maker for many job seekers. Money.
IT contractors get paid more per hour
The base hourly rate for tech contractors is much higher, ringing in at around $71 per hour on average according to Hired.com, which reflects the specialist needs frequently driving the need for the contract job. Another comparison in Dice's Salary survey in 2019 shows the average full-time technology salary at $93,013, which is $44.71 per hour for a 40-hour work week - not counting the overtime you might have worked. Meanwhile, the equivalent "salary" for the same role is 5% higher for an IT contractor working through a staffing agency. Of course, your overall salary or hourly wage will depend on role, skills, experience, location, etc.
While this doesn't apply across all levels of experience or industries, in general contract employees have a higher dollar-per-hour range compared to salaried employees. In theory, this is to cover the benefits that a company doesn't offer a contract employee, but when you are a candidate working with a company like Motion, many of these benefits are included, such as health insurance, paid time off, and even a 401(k).
You receive compensation for the hours you work: all of them
When you accept a full-time job, you have to accept that as a salaried employee, you are just that: on a salary. You get paid a certain amount each year, no matter how many hours you work as a part of that salary agreement. As a contractor, being employed for a 40-hour work week means actually working those exact hours, because you get paid by the hour. Frequently, salaried employees get called on to work on weekends, late nights, and early mornings. The difference for a contractor is that you'll get paid for the extra miles you put in on the job.
Extra hours = overtime pay
Thanks to a compliance law that changed in 2016, not only do you get paid for every hour, you can get overtime pay (1.5 times your normal rate) for anything past your set work week maximum. So the more hours you work, the more money you can earn. With projects that stretch deep into the night, your salaried coworkers are just as dedicated as you are, they're just not getting compensated for it.
Think about this: When working with a team to launch a new product, how many hours do you put in? If you'd like to be paid for all that time invested, a contract role ensures you will. Especially in these uncertain times, when companies are willing to hire IT contractors until they know they can sustain full-time employees, contract jobs are an option you don't want to overlook.
This article was first published on 5/26/16 and has been updated with current data.