Contract Work: What You Need to Know Before You Take the Job

After graduation, we all want to be settled into top-notch jobs, well on our way to becoming the company’s next CEO. In an ideal life, this grown-up life involves disposable income, paid vacation days and a career-building job that we love. However, even though that’s possible, the reality is that the path to our dream jobs isn’t always so smooth, and you may end up in a contract position instead of a permanent position. Contract work can be a great way to boost your resume and get the hands-on experience you need to break into your industry. Read on to learn more about it!

What is contract work?

Contract work is a category of work that includes a variety of different positions ranging from temp jobs to freelance positions. Typically, it’s a job that is available for a set period of time—for example, some companies may seek contract workers to get extra help on a big project for a few months, or they may need someone to fill in for an employee on maternity leave or vacation. These jobs can last anywhere from a few weeks to months and even years, according to Rick Gillis, author of Job! Learn How to Find Your Next Job In 1 Day.

As a contractor and not an employee of the company, you are often paid hourly (though salaries are not unusual, especially for longer-term positions) and do not receive benefits. Depending on the position, you may be expected to work 9 to 5, five days a week, like any other employee of the company—and aside from the differences in your contract, you may be treated like an employee of the company and be expected to represent the company as one of its employees. In other cases, you may come in just a few days a week or even work remotely. These terms will be set out for you at the time you sign your contract, and if there’s anything that’s unclear, ask the hiring manager!

Temp jobs are similar to contract work but are generally less formal and last for a shorter period of time. Most of the time, a temp job can last anywhere from a single day to a few weeks, but Gillis says they can go up to a few years. These positions are usually secured through a temp agency or though a headhunter who works with companies directly to provide them with temp workers. These are often jobs that don’t require a lot of training before you head into the office (such as a receptionist or a secretary), and you’ll often be called in the day of if somebody called in sick that morning, for example. Gillis explains that temp workers are essentially employees of the temp agency (that’s whom you’ll get your paycheck from) who work off-site at other companies.

Freelancing also falls under contract work, and it has many faces. There are the freelancers who are self-employed, in a sense: They make their own hours, work from home, offer their services to whomever they choose and are free to accept or deny any jobs. In some instances, they may have contracts to contribute to a company on a regular basis—for example, a freelance writer may be committed to writing a column once a month for a magazine. They’re usually paid for each individual project.

“Freelance can be anything,” Gillis says. “From album art to a book cover, it’s usually just one piece of work, and then you’re done.”

But then there’s the “permalancer”—made prevalent by the media and publishing industry, these freelancers may work part time or usually full time like a regular staff member, but they aren’t there under a contract—meaning they can leave at any time, but can also be let go at any time. They may be paid on a salary, but hourly pay is most common, and benefits like paid time off or health insurance aren’t included.

Who should do it?

Maybe you didn’t have the luck of landing a job right after graduation. Or perhaps in your field, it’s the exception, and not the rule, to have a full-time staff position as your first job after you leave college.

That’s why many recent grads turn to contract work before they find a full-time job. After graduating from the University of North Carolina at Chapel Hill this past May, Courtney Lindstrand took a freelance job in web production for a magazine in New York City.

“I was just so grateful to have some sort of job,” she says. She was, like many other contract workers, originally hired just to help out with a special project. She started out working just three days a week, and after a few weeks was asked to continue coming in five days a week—though she was still considered a freelancer.

For Courtney, the job was great because helped her get her foot in the door. It can also be a great option if you’re still undecided about the career path you ultimately want to take, because these positions allow you to explore various fields for short periods of time, in many cases without too much commitment.

“I would advise a recent graduate to take on any of [the types of contract work] because you get to go and taste it,” Gillis says. “You get to check out the flavor of the company and the personality and see if you like them or not.”

In addition to giving you the opportunity to explore your field hands-on, contract work can also be great for graduettes who love flexibility. Depending on the job you were hired for, you might just be working a few days a week, which is ideal if you need the time to work on personal projects or if you’re going to school part time. It’s also an option you should consider if you don’t want to settle down in one place immediately after graduation and want to be able to take time off for long travels, like a European tour or a backpacking trip.

Gillis also notes that statistically, most recent graduates only stay at their first job for two to three years, so the limited period of time you spend as a contract worker isn’t an unusually short amount of time to be spending at your first job after graduation anyway.

Lastly, contract work can be something you do on the side even if you do have a full-time job—for example, working as a self-employed freelancer can be a way to continue expressing your passion for photography even when you spend 9 to 5 in an office. Or, if you’re looking for some extra cash, you can check in with local temp agencies to see if they have weekend or evening positions available.

Who shouldn’t do it?

The reality is that there isn’t a lot of job security when it comes to contract work, and although the pay really depends on your level of work and the field you’re in, it can often be as low as minimum wage. It can be stressful not to know where your next paycheck is coming from or to wonder if the paycheck you’re getting the next week will be enough for you to make rent that month.

Gillis says that especially with contract work, recent graduates need to be able to take good care of their money.

“More and more people are [doing contract work], and it’s a scary place to be,” he says.

This lack of financial security and the possibility of being unemployed any day was the reason why Courtney decided freelancing ultimately wasn’t for her. “The worst part about freelancing for me, as someone who is all about having a super-planned budget, was the uncertainty and lack of job security,” she says.

The inconsistency also meant that planning for the future was difficult for her. “I never really knew exactly how much I would be pulling in for any given week, so it was hard for me to create a budget and make moves on things that were important to me, like upgrading my living situation,” Courtney says.

Ultimately, whether or not you seek or accept contract work depends on your personal preferences (do you prioritize a flexible schedule or job security?) as well as the field you’re going into. If it’s unavoidable but you do need a more consistent income, you may need to work part-time, such as in retail or at a restaurant, or temp after hours.

What happens when the contract ends?

Although you shouldn’t go into contract work expecting it to turn into a full-time job, it’s definitely a possibility—for example, the project you’re working on could get extended, the team you’ve been working with could realize your contributions have been invaluable or a new position could open up that you’ve proven to be a good fit for.

Whether you choose to leave a freelance position or your contract is over and your work is no longer required at the company, you should still treat your departure the same way you would if you were a full-time employee. Regardless of how you were classified on payroll, a contract position is still a real job that you should take seriously. Contract positions within your field of interest are a great addition to your resume, and if you have done a lot of freelance work across different categories within your industry, they can prove that you have a lot of well-rounded experience.

Be sure to stay in touch with your coworkers and supervisors. Even if you are temping for a few days, don’t be afraid to make connections; as a contract worker, you have the benefit of being exposed to more people than you might if you worked a full-time position at a single company, so take the opportunity to do some networking.

Freelancing might just be a foot in the door at your dream company, like it was for Courtney, who’s now working full-time at a magazine—and although she’s glad to know she’s getting a regular paycheck, she wouldn’t recommend that any recent graduates take the option of contract work off the table. Ultimately, any job will likely look better than a blank space on your resume, but at the end of the day, only you can determine if contract work is the right personal and career choice for you!