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4 Questions for Determining Whether to Hire Contract IT Consultants or Permanent Employees

by Julie Westhoff on February 15, 2021 in Blog, Hiring Challenges

There’s rarely a clear, black-or-white answer when it comes to choosing whether to hire IT consultants or full-time technical staff. In many hiring manager offices this decision is oversimplified. The events of the last year (COVID-19, widespread remote work, increased automation, etc.) have especially complicated the question, but there’s hope to simplify your choice.

The debate about IT consultants vs. permanent employees can be settled by asking and answering central questions about your next hire. Start with these four as you get to the definitive hiring arrangement for your goals, budgets, and challenges.

How Available Is This Skillset in the Local Market?

Every region has its own unique supply of technical talent. For example, Dallas might attract more financial analysts and product engineers. Houston typically has had a greater need for more data analysts who know how to analyze 3D seismic survey and drilling data. New York City boasts a surplus of financial services IT experts and cybersecurity leaders.

That’s not to say talent outside of a metro area’s specialty is nonexistent, but it can feel like searching for a dropped earring in the pouring rain. Often, IT staffing solutions can accelerate the search, finding the best person for the overall requirements and challenges. Yet even with the right partner, you might have to make tough calls that guide your ultimate hiring decision.

Here’s an example. Any decision maker trying to find talent with any of the top technical skills of 2021 will likely reach a fork in the road if their job vacancy remains open for too long. Then, there are two decisions left on the table: increase your bill rate to lock down the right IT consultant or hire a more junior candidate who you can upskill.

Your decision relies on how long you need access to the candidate’s particular IT skillsets. If you’re hiring someone to optimize your IT infrastructure or develop a single mobile application, then it’s reasonable to choose a premium IT consultant for the short-term. If the technical experience you crave is more integral to your business – maintaining IT security or ongoing developing a variety of apps and platforms – then hiring a candidate who fits your culture but requires training is a more sustainable workforce arrangement.

What Budget Do You Have Available?

Recruitment budgets were heavily controlled last year. According to Gartner research, 32% of companies have replaced some in-house positions with contingent workers as a way to reduce their workforce expenses. Whether that pattern trends or remains a blip on the radar depends on the economic recovery in 2021. Even then, there are some key takeaways for those wondering whether to hire full-time IT staff or IT consultants.

With some experts anticipating lowered revenue projections (especially in healthcare IT), there are several ways that departmental leaders can address these concerns. If there are urgent needs, it makes sense for some organizations to use their hiring budget as soon as it becomes available, avoiding any unexpected economic speed bumps. Of course, we’re not at a point where you should spend recruitment budgets just to spend them, but if there’s a requirement or challenge that added headcount can address, there’s no point in hesitation.

If your hiring budget is already exhausted, there are other options at your disposal. Using your operational budget to engage an IT contractor can provide stopgap expertise until more capital for full-time recruitment becomes available. Plus, this option can even be an effective way to test out candidates before you decide to hire them.

How Involved Will They Be With Other Team Members?

This is a bit of a trick question. Often, we’ll hear from decision makers who believe that when they engage IT consultants, they can onboard these people and allow them to work independently. But even experienced IT contractors need guidance and fast responses to any hurdles that arise or changes to the project objectives.

However, if a consultant would be collaborating heavily with your team, adding his or her expertise to essential projects or positions, it’s likely they’re a better fit as a full-time employee. Though contractors can and will interact with your team, there’s a clear difference between occasional engagement and full immersion in your business.

Side note: If you need more self-guided project delivery, it’s often better to engage an IT consulting solutions provider. They can own all deliverables, implementing their in-house processes and proprietary technology investments to overcome challenges and bring your vision to the finish line.

How Predictable Is Your Year Ahead?

The economy is in a tricky position. Though the rollout of multiple COVID-19 vaccines has lowered some business worries, there might be aftershocks in the near-term that can hinder recovery. Restaurants, movie theaters, hotel chains, and airlines have struggled and are not expected to rebound anytime soon, which if you are a vendor, can threaten your business too. Add some of the recent stock market unpredictability to the mix and it’s understandable that some companies are cautious about hiring.

Companies that are concerned about hiring full-time employees and remaining on the hook for their benefits are better suited with a flexible workforce that can scale with unpredictability. By engaging tech talent for a six-month, nine-month, or one-year basis (with the option to renew their contract), you can maintain progress on your ongoing projects without chaining your business to W2 tax withholding obligations. If your outlook grows more predictable, you can always convert IT consultants to full-time employees if you want to keep their talents and characteristics in-house.