NYCPHP Meetup

[nycphp-talk] Followup: Going weekly rate for phpdeveloper/coderinNYC these days?

Peter Sawczynec ps at sun-code.com
Thu Jan 18 15:29:20 EST 2007


The corp budget for contractors often comes from a separate line item
budget than the budget that pays for full-timers. Also, using
contractors keeps the corp off the hook for your medical, vacation,
holiday and long-term retirement. Plus, the corp only use contractors
when needed, where needed. It definitely makes financial sense to the
corp to use contractors. Peter

-----Original Message-----
From: talk-bounces at lists.nyphp.org [mailto:talk-bounces at lists.nyphp.org]
On Behalf Of Nicholas Tang
Sent: Thursday, January 18, 2007 1:10 PM
To: NYPHP Talk
Subject: RE: [nycphp-talk] Followup: Going weekly rate for
phpdeveloper/coderinNYC these days?


I guess a lot depends on whether you look at it as an employer or as an
employee.  From my perspective in terms of what I'd be willing to pay a
contractor, it's nowhere near 2.5x what I'd pay a full-time employee.
I'd pay them what I'd pay a full-time employee plus the savings in
benefits, which is more like 120% instead of 250%.  If they're
especially critical, maybe 150%.  I also prefer to hire full-time people
most of the time.  ;) 

> Money for vacation, sick and personal time - Consulting for yourself,
> you don't work, you don't get paid

Yup.

> Retirement funds - Somebody has to pay me to golf everyday and travel
> after I'm 65 1/2 ;-)

Yup.

> Medical and life insurance - This is the expensive part, 
> without a bulk
> discount, insurance is like $2000 a month

Yup.

> Business equipment/space/expenses - Somebody's got to pay the rent for
> your office space and equipment and related expenses

A lot of contractors work on-site, which eliminates these expenses.

> Taxes - Uncle Sam wants his cut too, the figure varies but it's
> somewhere between 25 - 30% of your pay...

Us full-timers pay taxes too.  :)  If not, I'd be on a yacht right now
instead of in the office.  ;)

> Misc. Benefits - Enjoy that free coffee, gym membership, or other
> activities at the office? Now you get to spring for them...

True, with the caveat above.  (If a contractor's in our office, they can
of course partake of any of the free coffee or other similar benefits as
a full-timer.)

> In addition, you are essentially running a business now so to 
> gather new
> business you have to pay for advertising, treating new and existing
> clients to lunch or dinner to promote new business, pay for your own
> training and certifications, and those trips to MacWorld, GeekCruise,
> etc...

Yup.

All of those are reasons why I never understood why so many companies
hire so many contractors - if I had a choice between hiring someone for
a 6 month contract, or to be a full-time employee for 15 months for the
same rate, I'd hire them full-time in a second.  It makes no sense to me
to pay such a huge premium for the same thing.  (And someone's value
goes up to me over time as they learn how the company works, how our
technology works, etc.  It can take weeks to get someone up to speed on
a new environment and practices, and it's a lot easier to eat that
"cost" over the course of full-time employment than if you bring in a
short-term contractor.)

Nicholas
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