Who to Hire? Employee vs. Contractor

How are you going to grow your business in 2014?  If ‘hire more employees’ was part of your answer, here are some thoughts to consider:

With the unsteadiness of today’s economy, massive shifts in employer provided healthcare, and increasing technology developments, many companies (big and small) are investigating the benefits of contract workers. Maybe you should, too.

In a recent Nashville Business Journal article, Gary Gerew shared the results of a CareerBuilder survey:

‘Forty-two percent of employers plan to hire temporary or contract workers in 2014…”

Unlike traditional full-time positions, contractors offer the benefit of access to a trained professional in a particular skill set.  In addition, the company saves money on training, benefits, and a lot of ‘down time’ that results from hiring a full time employee before the company genuinely has enough work to fill their forty hours a week.

When considering your last few hires, what are some of the challenges you faced? I’m betting that on boarding time, fitting into the existing team, and retention were near the top of that list?

While hiring a traditional full-time employee makes sense for many positions, especially those higher up in the organization, some tasks on your to-do list can be more efficiently handled by an outsourced employee.  Some more tried and true segments for outsourcing include IT services and inside sales reps, but what about accounting, HR, or even marketing?

An easy example is a service company in a specialized area – think roofer or florist.  Odds are, those businesses were started by a person passionate about the skill they are selling.  They might offer great customer service and an amazing product, but how can they know everything about all aspects of running a business?

More and more, the answer to this common problem is not to struggle through it until you have enough recurring income to hire a full time accountant, support a well rounded marketing team, or offer a permanent office for someone to manage the HR relations… for just a few other employees.

Targeting contractors willing to take on the segment of your business they specialize in offers a win-win scenario.  You are now outsourcing specific work to experts in the field, which will save you time and money… and who couldn’t use a little more of both?  :)

If you are considering hiring contractors or outsourced industry experts this year, first check with your professional network. Asking colleagues who they know and trust will cut out some of the “vetting” process.  For more options, check out some of these options:

Hire freelancers for one off jobs or part time commitments – eLance

Last thing: not everyone is a “contractor.”  Just because someone will do a little work on a contract basis, doesn’t mean you shouldn’t protect your company.

Make sure that you have an agreed upon scope of work, as well as a rate of pay (either by the hour or project) in advance.  Also, contractors should be able to provide your company with an invoice for their work and a W9 for documentation.  Depending on how much you pay an individual, you may have to provide them with a 1099 come tax time.

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