Contracting and Interim FAQs
I have been leading the Contracting business here at Morgan McKinley for the past four years now.
As a team, we have created four major business lines namely Commerce & Industry, Financial Services, Technology and Projects & Change. 90% of the time, we hear clients wanting to ‘hire a contractor’ for a period of time to undertake a piece of work/ project. Here are some FAQs we receive from time to time:
What is defined as ‘Contract’ and ‘Interim’, and why is ‘Interim’ evolving at speed?
Contracting has been prevalent for many years in Singapore and I certainly foresee this continuing and growing over the next few years. However, the level at which a ‘contractor’ is hired typically is at the more junior/ analyst level to clear backlog, replace an employee who is on maternity leave, long term sick leave or to fill a gap for a period of time.
What is changing?
As certain markets continue to retract, such as the Finance & Accounting and Corporate Governance space due to downsizing, offshoring, and taking into account the continuity of investment towards Technology and AI, this has a much larger impact than before on what is labelled as the ‘Interim’ market.
Companies now (whether they are a start-up, mid-size or a large blue-chip) are aware that there is a wide array of talent either affected by the shift in the ways the markets are working, or worked in the corporate world for many years and wanted to try something different. This is the case in other parts of the world such as the US, UK, parts of Europe and Australia – which have large interim markets.
Contradictory to the above, these hires are typically Director/ VP level and above, and can often be strategic type hires without large staff management responsibilities to really focus on a piece of work, whilst ensuring it is completed within a certain time period – this approach is starting to appeal to more and more.
So, are you saying I should leave a stable permanent position for an Interim role?
No, and I must stress Interim roles will not appeal to everyone. However, it is down to personal preference and what you are looking for as part of your next role. If you have (like a number of senior professionals in the corporate world) reached where you wish to be, want to try something different, strip back the midnight calls and staff management responsibilities, and really focus on a piece of work adding significant value, then this could be for you.
Throughout the course of 2019, I found it amazing how many excellent premium permanent candidates came forward wanting to try something new (Interim).
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But what happens after the Interim assignment/ project comes to an end?
Of course, this is always something to be mindful of. That said, there are a large amount of interim assignments that get extended and also let’s be conscious of how many projects actually start and finish on time?! We often place interim roles on the basis of at least 6 months but likely 12 months and beyond due to the nature of work that is typically required.
Interestingly, over the last couple of years the average tenure in a role has been observed to be around 2 years. One of the key messages to point out here is that an interim hire is made with a purpose in mind. A purpose to undertake a piece of work and add value. Let’s play out a simple scenario - the assignment ends after 12 months, we then add the previous 15-20 years corporate experience, in addition to the experience gained during these 12 months and this can then be taken into something new and then something new, and so on… At whatever stage you are in your career, people still want to learn.
OK, that does sound interesting, but financially would I be better off?
Good question. Unlike countries such as the US, UK and Australia, there are very little financial benefits (insurance, bonuses etc.) for choosing an interim/ contract position. Singapore is still very much a maturing market in that sense and there does tend to be a negative stigma attached to contractors as the general population would still favor a permanent role.
However, all that is changing. As more and more companies continue to compete for top talent, it is becoming a candidate driven market which, in my personal opinion, over the next couple of years, will be able to demand X, Y and Z for them to join that company.
On the other hand, let’s look at the average salary inflation rate across Singapore which is around 3-5%. If you earn X at the moment, and then take a 15% - 20% hike for a 12-month contract, then what is stopping you gaining a further 15 - 20% for another interim project. You have now increased your earnings by 30% - 40% over the course of 12 months, and learned a range of new skills along the way.
Here's the guide to 2020 Salary
What areas could an interim hire be made and into what sectors?Some of the roles we have placed interim hires into are;
- Finance – FP&A Director, Commercial Finance Director, Chief Financial Officer
- Technology – Specialist Network Lead, Head of Applications, Senior Developer, Chief Information Officer
- HR – HR Manager, HR Business Partner, HR Director
- Marketing – Marketing Manager, Marketing Director
- Financial Services – Compliance Head, VP Finance, Head of Finance, Risk Manager
- Legal – Corporate Secretary
In summary, we are seeing more and more demand for senior talent on a short – mid-term basis from our clients, but also more appetite from the talent pool. If the interim market is something you would like to explore and get a more detailed overview, please drop me an email and I would be delighted to connect for a confidential discussion.