Should You Hire Contractors or Full-Time Employees? 5 Factors to Consider

There are many things to consider when hiring new employees. But before you bring any new people onto your team, you need to determine whether you want to hire people on a full-time or freelance basis. Here are five factors to consider when deciding to hire contractors or full-time employees.

How Soon You Need Someone to Start

There’s a lot of work that goes into hiring a full-time employee. You need to conduct several rounds of interviews with many qualified applicants in order to narrow down the field to people who will actually fit with your company. And sometimes, you won’t find anyone who’s just right for the job. When you need someone to come on right away, it makes more sense to go with a contractor. They know your general business, so they will require minimal training, and can start working day one.

How Long You Want the Employee to Stay

There’s a flip side to hiring someone with speed. When you have to rush someone in to fill a void in your operations, it’s likely that you aren’t going to get the perfect fit. And employees who don’t feel like they belong at a company are more likely to leave. This isn’t so bad if you run a company like Lyft, where your drivers don’t come into an office every day. However, for many businesses, disgruntled employees can lead to a toxic company culture. It can also cost your company a lot of money if you need to keep training new employees. For companies that know they want to hire people that will stay, it’s best to invest in a full-time employee.

You Don’t Want to Pay for Benefits

One of the great things about working full-time is that your employer will offer health and other benefits. At least, potential full-time hires will expect this of your company. Good full-time employees will want insurance, so they can get things like workers compensation should they need it. Contractors, on the other hand, will not expect you to offer them insurance or other benefits. You may have to pay them more in terms of hourly wage; but this often still negates the costs of providing benefits.

You Want People Who Care About Your Business as Much as You

Business owners want their employees to share their passion for their company. Contractors are not likely to be highly invested in the culture or bottom line of a business beyond how it pertains to them. They also aren’t going to go out of their way to improve internal systems within the business. This is something, however, that will come with full-time employees. They know their paycheck depends on the health of their employer, so they will be more likely to go above and beyond the call of duty. Contractors often work with many companies at the same time, and so aren’t overly attached to any of them.

You Want to Hire from Within Your Company

One of the best ways to find talent to initiate new projects or take over for someone when they leave is to hire from within your organization. This becomes difficult when your staff is overwhelmingly comprised of contract workers. Sometimes contractors will switch over to full-time employees if you make them the offer. However, they often have other obligations, and sometimes can’t do that. On the other hand, full-time employees are almost always looking to work their way up through a company. It’s easy to find a great new manager when you have candidates training for that position within you company every day.

These are some tips to consider when deciding to go with a contractor or a full-time employee. There are merits to both types of worker; so you should really consider which option works best for your specific business and hiring needs.