Is it time to go contracting? Weighing up the pros and cons

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Projects are, by their very nature, temporary, so it is not surprising that a mature contract labour market exists for project management professionals. Perhaps you are considering this route?

It is a big decision – particularly for those used to the relative security of a permanent role and salary. So what are the benefits? Well, income is the big draw. In its simplest form, you accept more risk, and therefore you can receive more reward. But recognise that you are also accepting more risk.

Most contract roles have one-week notice periods, so your revenue stream can quickly disappear. Anyone who starts contracting should save a minimum of three months’ income beforehand because, at some point, your contract will end. Don’t expect to jump straight to a new contract. And consider how your mortgage or rent will be paid in the meantime. And what day rate should you ask for? I use a simple rule of thumb: take your annual salary and divide it by 100. So if you earn £45,000 a year, this equates to £450 a day. A good, long-term role for the right organisation that only pays £390 should still be attractive, though.

Is there anything else to consider? Your career development rests solely on your shoulders, so make sure you invest in yourself. Continue your professional development. Just don’t start multiplying your day rate by the total number of workdays that exist annually to convince yourself that you deserve that new car, or even worse, can afford that huge mortgage. Be conservative. Remember, you have holidays, get ill and need to have savings for when the project ends. Oh, and you will have a tax bill to pay.

Vince Hines is managing director at Wellingtone Project Management, an APM career development partner.

Other blogs in this series:

Find out more about starting / developing a career in project management

Vince Hines

Posted by Vince Hines on 26th Jan 2016

About the Author

Vince is the Managing Director of Wellingtone, the project management recruitment, training and consulting company based in Windsor, Berkshire. The Association for Project Management and Wellingtone have formed a unique alliance to provide a career development service to the project management profession. Wellingtone is also an APM accredited training company and a Microsoft Gold Partner for Project and Portfolio Management. Vince is an expert Project Management Consultant, having worked with clients across the UK, US and Europe. He retains a number of professional qualifications including MAPM and has extensive real world experience of developing client project management maturity. As Managing Director of Wellingtone Vince has a particular insight into career development and recruitment of project management professionals and is a judge for the Annual APM Awards.

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