Contract work had not been in Kurt Texiera’s plans, but when the company he worked for began to struggle during the pandemic, the 30-somehing, with a background in supply chain who had worked for private equity firms for a decade, said he put his resume on LinkedIn and within a couple of months, recruiters including PeopleCaddie began reaching out to him. He interviewed with companies that were offering full-time jobs but, “I started to get the same vibes that I got from the company that I was looking to leave,” he said, adding that it was not until he spoke with a recruiter at PeopleCaddie that he felt a comfort for the contractor environment.
He recently accepted a one-year independent contract with a company in California. He is not sure how things will play out but for now, he is enjoying the flexibility and compensation. Texiera said he would usually work about 10 hours a day and given more responsibility and was not necessarily paid for it. Contract workers are paid for the extra time they put in.
Now, he works a 40-hour week, which he says allows him the flexibility to plan. “I am not having any surprises, it’s eight hours a day and I am off the clock,” he said, adding that he has time to spend with his family, which includes a three-year-old and a six-year-old. In fact, he noted that he works remotely and has plans to spend some time at the family’s lake house in New Hampshire.
As for benefits, Texiera said he had a good 401(k) plan and would get a decent bonus every now and then. But health insurance was a huge problem, he said, noting that for his healthy family of four, he was paying $800 a month and a high deductible. With Connecticut’s insurance marketplace, he was able to competitively bid for a far less price at roughly $60 a week, he said.
Rowley pointed out that W-2 contractors who work through an agency like PeopleCaddie have access to healthcare and other benefits through the agency because they are technically employees of the agency. Independent contractors, on the other hand, are on their own when it comes to benefits, but Rowley explained that they receive a premium, a part of which account for the fact that the employers are providing benefits to these contractors.
In addition, Rowley said the employers also pay a risk premium because the contractors are assuming greater risk than the traditional permanent employee. They are getting paid additional money with the intention that they will be able to cover their benefits costs and save for retirement.
Rowley noted that while there are several attractive features tied to contract work, it may not be the right path for some. He noted that many contract workers build relationships at that company and secure long-term positions. “It’s a viable way to get your foot into the door,” he said.
“But before anyone makes that leap to contract work, I advocate that they do their homework because there is a bit more risk and they have to manage that risk,” he said, explaining that they should make sure that there is consistent demand for their particular skill.
Sasha Guan, a longtime gig worker agreed. The California resident, an auditor, has been doing contract work through several agencies since 2012, when she was in her early 30s. For now, she is with PeopleCaddie. Prior to contract work, she had worked full time in the industry.
Guan said she bought into the gig economy because she wanted control of her work/life balance. It was good for a while, as she was able to travel the world during that time. But over time, Guan said she became discouraged because she was not growing in her career. She said she was getting assignments at the Big Four accounting firms, but they were always ‘senior’ roles for workers with three to five years of experience, and she had almost double that.
“So, you could get stuck doing very mediocre stuff and you don’t actually get to build up your resume,” Guan said, adding that developing seniority within a company matters if, and when you decide to apply for a senior management position. Otherwise, she said, “you’re always going to be moving horizontally.”