Home » Contract Employment vs Permanent Employment – Your questions answered

Contract Employment vs Permanent Employment – Your questions answered

You are seeking your next job opportunity and realize there are both contract jobs and traditional permanent  jobs to choose from. Which is better? Well, it depends, so let’s take a look at what each job situation might mean for you.

What’s the difference between contract and permanent employment?

It’s important to note right off the bat that even though the names commonly used for these two types of positions makes it sound otherwise, both contract jobs and permanent jobs are most often full-time, 40-hour week jobs

To put things simply, the two main differences between contract work and a full-time permanent employee are 

  1. who you receive your paycheck and benefits from, and
  2. how long you are set to work for the company.

As a permanent employee you are employed by, work for, and receive your paycheck from the same company. You are hired on permanently, with no set end date and are in it for the long haul – or at least until you decide to leave that company.

As a contract or contract-to-hire employee, you do work for the company you are matched with, but are technically employed by and receive your paycheck and benefits from a staffing agency (such as PEG). You’re contracted to work at the company you are matched with for a specific amount of time agreed upon when hired for the project (one month, six months, etc.). Once this contract period is complete, it can be extended or you can move to a different role with the same company, or you can move to a different company altogether. You’re the driver! No matter what, PEG will work with you to find the next great job that fits your needs and lifestyle.  

Is the work itself different, contract v. permanent employee?

No, it’s not really! Just like permanent positions, contract and contract-to-hire roles run the gamut. Depending on the company and their needs, a plethora of roles can be offered in both categories. Employers will expect contractors to be communicative, team-oriented and results-driven just as their regular office employees are. 

Who should work a contract or contract-to-hire job?

In a word, anyone! 

A contract or contract-to-hire job may be for you if: 

  • You want to get your foot in the door with great companies 
  • You’re a recent graduate looking for resume-building experience in a variety of roles
  • You want to test out the waters with a company and see if it’s a good fit for your life and career goals 
  • You’re returning to the workforce after an extended period of time and are struggling to get companies to take a risk on you (despite your years of experience) 
  • You’ve experienced an unexpected job loss and need options and support to find your next permanent position
  • You’re ready for a career or industry change 
  • You love exploring options and opportunities
  • You prefer to work on projects rather than long-term commitments 

What’s the interview process for a contract job?

At PEG, our client companies who hire us to find, interview, and recruit top notch talent for them determine whether a job will be a contract, or contract-to-hire position. No matter which type of position you are interested in and interviewing for, the process will be very similar and PEG will help you every step of the way. 

Wondering what to ask your recruiter before your interview with the client company?

Here are some ideas!

  • How long does the contract last?
  • How many hours will I be expected to work each week?
  • What are your expectations of my role?
  • What kind of career growth will I gain from this opportunity?
  • What kind of snacks do they have at the office? (just kidding…)

Basically, contract work can be a great fit for you!

If you’re looking to test drive a few positions and get a feel for a company’s culture (hello, recent graduates or those returning to the workforce!), and contract jobs offer you the flexibility to work directly with a company to know if a job is right for you before locking yourself into a forever role. 

Need a quick visual to compare and contrast? We got you!

Contract Employee Permanent employee
Receives paychecks, benefits, etc. from PEG and do work for a PEG client company Receives paycheck, benefits, etc.directly from the company they do work for
Typically works 40 hours a week, but could vary depending on the contract Works a standard 40-hour week
Often has a known “end-date” for the contract (with the possibility of it being extended) Has permanent placement in their job
Maintains flexibility to explore different companies and roles without the threat of resume gaps.  Limited ability to “test the waters” of a new role or company. 
Know your own dedicated PEG recruiter who will look out for your best interests and advocate for you as an employee.


Let’s Go!

Ready to get started? Get to know our talented team of recruiters and reach out via email or phone to the person you connect with. 

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