IT Consulting versus Full Time Staff: Comparing the Costs and Benefits

IT Consulting versus Full Time Staff: Comparing the Costs and Benefits

There are very few businesses that don’t rely in some way on IT systems. Whether you use enterprise software like a CRM or project management program, or you need to maintain on-site or cloud servers, you need IT support and IT consulting in Miami. Even creating a website for your business falls under the general category of IT. If you own a small to midsize business, you’ll be faced with a choice for your tech needs: you can hire a full-time staff member, or you can bring in an IT consultant on a temporary or occasional basis.

Many businesses don’t really need someone to handle their IT full time. If you don’t, hiring someone can be a needless expense, and the cost is relatively steep. IT manager salaries are usually in the low six figures, which may very well be more expensive than any of your other staff.

Cost Comparison: Employee versus Consultant

Many IT consultants previously worked as full-time employees. When a worker makes the transition to consultancy, their hourly rate increases. There are some very good reasons for this. Consulting work is less consistently full-time, involves more uncertainty, and can involve devoting time to non-billable things like client acquisition, billing, and bookkeeping. As contract workers, consultants also don’t generally have access to employee benefits, meaning they’re responsible for things like higher taxes and health insurance.

Even though an IT consultant’s hourly rate might be higher than that of a full-time employee, you’ll save money if you don’t actually need someone to work 9 to 5 every day. For example, you might pay the equivalent of $46 an hour for someone who works full time and is legally classified as an employee, but pay nearly double of that for a consultant. You might think that a consultant must be far more expensive, but this isn’t generally the case. If you only need your consultant a few hours a week, you’re still saving quite a bit of money. For small to midsize businesses, the amount of savings is meaningful.

Along with an IT manager’s considerable salary, as an employer, you’re also responsible for providing competitive benefits. Typical employee benefits include things like medical and dental insurance, an annual bonus, 401k contributions, and payroll taxes. This brings up the cost. If you don’t offer decent benefits, you may have trouble attracting a skilled IT staff member. It’s a growing, thriving field, and IT managers aren’t exactly desperate for employment.

Other Benefits of a Consultant

Overall savings aren’t the only benefit to hiring an IT consultant instead of bringing on a full-time employee. Overall, contractors generally incur less financial risk. It’s easier and faster to make hiring and firing decisions with contract workers than with full time employees. Underperforming employees are more likely to be kept on payroll for months on end, due to the hassle and cost of hiring someone else. There’s also the matter of avoiding potential employee lawsuits. Hiring IT consultants instead allows you to avoid these issues.

For small to midsize businesses, hiring IT consultants for specific tasks or projects can make a lot more sense than bringing on a full-time employee. Despite a higher hourly cost, the overall cost of consulting is lower than that of an employee’s salary and benefits. At Gradientdata, we specialize in IT consulting services for businesses like yours. To find out more about our services, reach out to us any time at (786) 619-3832.