IT Contractor Rates
IT Contractor rates – how much will I earn?
The first thing that people who work in IT who want to become an IT Contractor want to know is how much they will earn if they start contracting. It used to be always said that anyone starting as an IT Contractor would get around twice as much contracting as they got in their permanent job. Of course, this varies depending on the stage of the economic cycle.
If it’s a boom IT Contractors rates soar. If it is a downturn, IT Contractor rates can go down quite a bit. Permanent salaries can’t be put down.
Three years ago, IT Contractor rates for a developer averaged Â£450 a day. Now they average Â£375 a day according to ITJobsWatch, which is a big drop.
Usually when a contractor’s annual income is calculated the weekly rate is multiplied by 48 weeks. That means that a contractor earning Â£400 a day would be seen as earning Â£96,000 a year.
However, because of the short-term nature of contracts, usually of 3 months or 6 months duration, IT Contractors normally spend some time ‘on the bench’ during the year.
Some contractors keep getting renewed at one company and they can pile up quite a stack of money if they can do that. Often, though, a project, and therefore a contract, will only last a certain amount of time and then that’s it.
There’s been many a contractor, on his or her first contract, who was out of work after 3 months and at a disadvantage to more experienced contractors in the job queue.
It used to be that companies would take IT Contractors a few weeks after interviewing them. Now they usually want the contractor to start on the following Monday after the interview.
As contractors don’t usually know if they are going to be renewed till 2 or 3 weeks before the end of the contract (or less) a period out of work is almost inevitable. Then it usually takes a few weeks (or more in a downturn) to look for work, interview and get accepted.