Main image of article Life as a Contractor: It's Not for Everyone

Not every tech professional wants to work for someone else. Many would prefer to strike out on their own as contractors, setting their own rates and acting as their own boss. However, before you decide to ditch that W-2 and head out into the contracting world, you need to recognize the potential upsides and downsides.

The Pros and Cons of Contracting

Let’s start by breaking down the upsides of the tech contractor’s life:

  • Flexibility: If you ever wanted to set a flexible schedule and/or work from home, now’s your chance.

  • Control: Contractors can choose their clients. Want to work for big enterprises or smaller startups? Either one is an option (or something in-between).

  • High earning potential: Tech contractors can set their rates—and if they have highly specialized skills, they can command top dollar.

  • Focus on what you want: If you have specific goals for your tech career, becoming a tech contractor can help you focus on those.

But there are also some downsides:

  • You have to build your own network: Unlike a full-time job where you’re inserted onto a team and form connections with colleagues, contractors must find and connect with clients and collaborators on their own. Depending on your circumstances, this can be easy or difficult—but it can prove especially challenging to more introverted types.

  • Business fluctuates: Depending on your market and specialization, some years you’ll have more business than you can handle—and sometimes you may face a work drought. As a result, you’ll need to plan and budget effectively for the long term.

  • Benefits are on you: As a contractor, you’re responsible for your own health insurance, retirement, and more.

  • You need to keep your skills up-to-date: You won’t have an employer who’ll pay for your training (and give you the time to do it); you’ll need to find and fund training and education options on your own. That can put a significant squeeze on your schedule.

What Skills Do Tech Contractors Need to Know?

The skills necessary for the contracting life will necessarily vary from contractor to contractor; for example, someone specializing in web development will need a completely different list of abilities from someone who works in machine learning. That being said, there are some commonalities:

  • Self-Management: Develop strong time management skills, prioritize effectively, and stay organized to ensure project success.

  • Running a Business: Set up a legal business entity, obtain necessary licenses and permits, and understand your tax obligations. Consider consulting with a financial advisor for personalized guidance.

  • Networking: As mentioned before, you’ll need to network hard to build a solid client list. Attend industry events, connect with colleagues online, and leverage your skills and experience to attract clients. Build a compelling portfolio and online presence to showcase your expertise.

  • Learn, Learn, Learn: Dedicate time to continuous learning, whether through online courses, workshops, or professional certifications. Stay ahead of the curve to remain competitive.

  • Marketing: Marketing can prove a frightening concept to new contractors who’ve never had to do it, but there are some effective ways to put yourself out there, including highlighting your skills with generative A.I. and other cutting-edge tech.

What Types of Consulting Can I Pursue?

As we broke down in a previous article, there are multiple pathways for a tech professional interested in contracting:

  • Management Consulting: Assisting clients across various technology sectors with strategic planning, operational improvement, and digital transformation initiatives.

  • Technical Consulting: These consultants focus on specific tech areas such as cybersecurity, data analytics, cloud computing, or artificial intelligence, offering specialized expertise to clients. They often come from a tech background and can delve deeply into the technical aspects of a project. They may conduct activities such as risk assessment, for instance.
     
  • Independent Tech Consulting: These consultants range widely, jumping from client to client and even industry to industry, giving their best tech advice.
     
  • Specialist: Some consultants choose to hyper-focus on a specific aspect of business, such as disaster recovery or cybersecurity.

A recent report by Upwork suggested that 47 percent of all freelancers (or roughly 30 million professionals) are involved in knowledge work such as computer programming and IT functions. That’s a lot of potential competition out there, but if you specialize and network effectively, you can land all the clients you need to maintain a robust life as a contractor.