Consulting: New way to think work

When the job search takes longer than expected, people begin considering other ways to make a living. One alternative is to become an independent contractor or consultant. Do we continue the search for a permanent position or is this the right time to hang out a shingle and fly solo?

Many signs point to yes. The economic downturn, upcoming health-care reform requirements and a shift in work/life values may have created the perfect storm for independent contracting and consulting.

Many businesses are striving to be more financially prudent. One way this is playing out is through cautious hiring practices and a more efficient way of allocating talent. Rather than bringing on full-time employees, companies are looking to hire the exact best talent they need on a project-by-project basis.

Kathy Dotson and Kim Homolka recently launched Kdragonfly to help connect organizations and independent contractors. According to Dotson and Homolka, “The way we work is changing. Technology is driving much of this transformation as businesses need talent that is highly skilled, on demand and for shorter time periods. By hiring contractors, companies are able to reduce costs and pay for talent only during the project life cycle versus paying a full-time employee.

“Individuals are also driving this movement as they are craving work/life balance and a desire to control their own destiny. Some initially reluctant independent contractors who were forced into this type of work arrangement due to the downturn have actually chosen not to return to full-time employment. By diversifying their client base versus relying upon one employer for income, they lessen their financial risk.

“People should realize that working independently will no longer be the exception but the norm. Today, some 15 million people across the U.S. operate in the 1099 economy. That amounts to roughly 25 percent of the workforce. Experts predict this number to grow to 50 percent of the workforce by 2020.

“Northern Colorado typically sees many contract opportunities in the high-tech industry. However, what we anticipate is an extension of contract work into other occupations and industries such as health care, finance and administrative roles.”

The benefits of contracting exceed dollars earned. You are building professional relationships, developing skills and taking charge of your career. Contracting offers a unique opportunity to showcase your talent and prove your value is beyond what you list on a resume.

This can lead to other referrals or it can put you in the running for permanent positions that come available. Consulting gigs can reduce the stigma, stress and financial strain often associated with unemployment.

It has become modus operandi for job searchers to add “consultant” to their resumes in order to minimize gaps in employment. That is fine as long as you are actively pursuing consulting opportunities. Keep in mind that hiring managers and recruiters will ask about your most recent projects. It’s important to be honest; don’t falsify your resume.

It is also important to remember that working independently is not for everyone. Many people absolutely need benefits for health care and retirement planning that often come with full-time positions. If the goal is to find a “permanent” job, than it is important to consider how contracting could hinder rather than help your search efforts.

For example, how will taking a contract position impact unemployment benefits? Will you be able to take time off to interview? What happens if you receive an offer in the midst of a contract assignment? Do you realistically have the time and energy to maintain the momentum of a job search while providing high-quality contractor services?

Juggling contract assignments with a dedicated job search can get tricky. Dotson and Homolka said, “If an individual is looking for a stopgap measure to full-time employment, this may not be the best option. You may be better off working through a staffing company as a W-2 employee. Independent contractors are generally not searching for a job. They have made a choice and a commitment to growing their consulting businesses.”

Keep in mind that independent contractors wear many hats. It takes a unique skill set and considerable drive to manage the business side of being your own boss. Going solo requires being adept at marketing and closing deals, negotiating contracts, maintaining an accounting and billing system, managing a website and continually updating the products and services one offers.

“Contracting is not for someone who wants to come into an office everyday and be told what to do,” say Dotson and Homolka. “This is for the person who can be given a project and work independently to produce a deliverable. We also recognize that one of the biggest challenges independent contractors face is marketing their businesses while they do what they love.”

In the end, contracting may become more of a necessity than a choice. Like it or not, the need to pay the light bill and put food on the table may push us into a new way of working. The good news is that opportunities should increase. While most businesses will always need some dedicated employees, the trend is towards a more mixed use of talent.

If you do decide to seek contracting opportunities, Dotson and Homolka offer this advice: “Just saying you are an independent contractor isn’t enough. It’s important to follow proper set up and tax rules, which makes you more marketable. Businesses want compliant contractors so they can minimize tax and legal risk by working with you.”

Dotson and Homolka understand the challenges faced by those looking for work and by companies that are in need of talent. “It is frustrating to see highly-skilled workers and qualified people go without work because they are dependent upon traditional recruitment cycles. It is also frustrating for businesses that struggle to find local talent to meet project needs. The work is out there. It is just a matter of putting the right skills and projects together.”

In the not-so-distant past, working was an exchange of job security for employee loyalty. Today working is a simple trade of talent for opportunity. And, by the way, there really is no such thing as a permanent position. In essence, all work is temporary. When we think about it that way, perhaps flying solo is the only way to go.

Carrie Pinsky is a Fort Collins-based career and HR advisor. She can be reached at carrie@pinkskywriting.com.

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