Contracting is fraught with many pitfalls and challenges, but most of the problems exist in our heads. Here are the most common complaints I hear from contractors and how to overcome them.
Benefit Envy
Benefit envy can rear its ugly head any time during your contracting career, and it most likely will repeatedly do so. Bouts of benefit envy are most likely to occur after the successful completion of a long project, where employees may receive a bonus or are thrown an after-hours party for a job well done. Another recurrence of benefit envy may crop up when it comes near to employee performance appraisal time. As a contractor, you will not receive the same praise and recognition as your employee peers, even though you have worked just as hard (if not harder) than them. You may find yourself gritting your teeth and silently seething about how they receive bonuses, raises, paid time off, special recognition, and other benefits reserved only for employees.
The solution here is to remind yourself that all those benefits have strings attached to them. That performance raise Joe got that he keeps gloating about? Well, he put in 20 extra hours a week for the last six months as a salaried employee, and he didn’t receive any extra pay for those hours. Meanwhile, smart you has banked all your extra overtime cash, since you get paid for every hour you work. Take a minute to look at your fat and happy savings account. Most likely, you made more money over the last six months than what Joe just received as a performance bump. Since it didn’t come to you in a lump sum, Uncle Sam hasn’t taken as big of a chunk out of it, either. That after-hours party? Hob-knobbing with people during your precious personal time isn’t all it’s cracked up to be. Besides, you’re a contractor. Your career does not depend on hob-knobbing with folks at a company where your time has an expiration date. So, who’s the smart one now?
I Don’t Get Any Recognition
The recognition trap is a very dangerous trap because of its tendency to quickly drain your morale. Maybe you find yourself feeling angry because it seems nobody on your team takes you seriously, or you feel you have great ideas that others simply don’t pay attention to. Maybe you’re feeling slighted because people assign you tasks that no one else wants to do and are way below your capabilities. If you’re nodding your head in agreement right now, then you’ve fallen into the recognition trap.
If it’s recognition that you are truly craving, then perhaps contracting is not for you. Your contract career is not driven by recognition of others. You were hired on a contract basis to do a very specific job. At some places, your input will be valued, but you will find other places that view you as a cog in the machine, a person who is supposed to do a job and not offer any ideas on how to improve a process. Usually a glance at your paycheck is enough to remind most contractors of what their true goals are. Your goals should be to make the most amount of money to provide a comfortable life and retirement for your family. In the end, you are all that they have. Remember the trade-off. As a contractor, you make more money. You traded ladder-climbing for a larger paycheck. You turned in your ticket to being a valued employee for making more money. Ask yourself this question: after you retire early to your dream house on the ocean, will it matter how you made that money? I didn’t think so.
Entertaining Notions of Becoming an Employee
Since the majority of contractors I know are not contractors by choice, there is often a preconceived notion that if you work hard enough and make yourself likable and indispensable to your team members, your chances of becoming an employee are greatly improved. I hate to burst bubbles, but this just isn’t true.
The company hired you as a contractor based on fiscal reasons, not your glowing personality and can-do attitude. There is something going on within the financial walls of the company that prompted them to hire a contractor instead of an employee. No amount of brown-nosing is going to change the bottom line. Unless you get it in writing from your contracting agency and the company that the position you are filling is a contract-to-hire position, you must assume that your contract will expire on the agreed-upon end date. Forget what anyone else has told you about the possibility of you becoming an employee. Otherwise, you find yourself becoming more and more disgruntled and resentful as your end date nears. Instead, display your appreciation for having had the opportunity to work alongside such wonderful peers. Your positive attitude may lead to you receiving another contract with the company in the future.
Feeling a Loss of Security
Perhaps the most frightening thing about being a long-term contractor is the feeling of going out without a safety net. After all, most contractors are not eligible for stock options, pension plans, group health insurance plans, or 401(k) plans. If you happen to be one of those fortunate contractors who is eligible for some of those benefits, be wary. They may be the cheapest plans the contracting agency could afford. You could end up buying into a health insurance plan that has no plans on approving any claims, even legitimate ones. Or you could end up with a 401(k) plan that invests in losing funds.
More often than not, in lieu of benefits, contractors are often paid a handsome hourly wage. Now is the time to become intimate with the finer details of your bank account. More so than ever before, you will have to manage the influx of money and begin establishing your self-funded safety net. A few meetings with a financial planner may be able to help you shape your goals so that you can make the most of your elevated income. The last thing you want to do is line everybody else’s pocket besides your own. Other benefits of concreting your goals is that you will feel safer doing contract work, you will become financially savvy, and you can look at your goals whenever benefit envy begins to creep in, or you are feeling underappreciated.
