Your options to come out ahead of the pack.

The demand for contractors is a little slow at the moment and I’m regularly being asked questions by contractors about how the market is faring and where are the opportunities are, so I thought I’d summarise and answer them along with a few ideas to improve your odds if you are looking for your next assignment right now.

I’ll be talking about

• The current landscape and how we’ve got there.
• Why we should be positive.
• Contracting Vs Permanent or fixed term contracting
• Rates and how they are set.
• Upskilling, and how important that is as a contractor.
• Your LinkedIn profile.
• Interview techniques.
• And mitigating risks.

So, a lot to get through, let’s start with what’s going on out there.

The Current Landscape

From a contracting point of view this year has seemed to slowly get tighter and tighter.

Globally we have the fallout from covid, high inflation and cost-of-living crisis – I know I’m feeling the pinch every time I go to the supermarket.

Interest rate hikes are the blunt tool used to curb inflation and their designed to reduce our discretionary spend.

Locally the flood disasters that swept NZ slowed our agricultural industries and increased costs for infrastructure repairs.

All this in an election year. Election years are notorious for slowing hiring decisions, it happens every time, without fail.

I saw Business confidence slipping early in 2023, and mid-way through the year we slid into a technical recession after the economy contracted for 2 consecutive quarters.

Unfortunately for us, cutting contracting overhead is a simple economic and political decision to make.

Projects have begun to be cut back, contracts have not been renewed and in some cases, organisations started changing strategy and looking to replace the contingent workforce with permanent employees.

To put everything into perspective let’s reflect a little on the last 3 years:

Covid initially brought us almost to a standstill. But we soon bounced back, and January 2021 was the busiest start to the new year from a contracting perspective I can recall.

Contractors were in demand, there were too few people, zero migration and pent-up projects to be rolled out. Contracting rates increased rapidly and first-time contractors entered the market.  It’s been a very bullish 3 years.

So, there are some who haven’t experienced a downturn in the market before and haven’t previously navigated through tricker times. If that’s you, I hope I can offer some guiding insights and principles. Even if you are a veteran of many campaigns, I trust there’s something you can take away.

The first thing is remaining positive.

The economy is cyclical, I’ve seen many ups and downs:

Y2k, the dot com bubble burst, 9/11, the GFC, Covid and now this economic downturn.  Regardless, it will turn around and we are seeing signs already.

The latest economic and fiscal update from the treasury shows a 0.9% growth in the last ¼ and in Grant Robertson’s words, the economy is “turning a corner” and we are no longer in a recession.

It’s definitely harder at the moment, but it’s not stagnant, and there are plenty of organisations just waiting for the political certainty of the next government to be locked in, before making final decisions. The election is now only a month away.

Organisations looking to get ahead should take inspiration from the racing driver Ayrton Senna’s quote:

He said, “You cannot overtake 15 cars in sunny weather – but you can when it’s raining”.

As soon as we do turn a corner contracting will pick up, I would be picking the 1^st ¼ of 2024 for when we see this.

But that doesn’t help us now So, how can you manage and mitigate the risks and challenges to ride out this downturn and come out ahead of the pack?

A key question contractors will be asking themselves is, should I move back into full time permanent employment?

Depending upon your circumstances, this may be the right option. Contracting has many positives, optimising your earning potential is one and generally the opportunity to work on a wider variety of projects is another.

Permanent roles however have a different set of benefits. Not least is career progression. If you have a burning ambition to be in a role other than the one you are in currently, then it’s more likely a permanent role that’s going to see you nurture your career goals.

If you have a desire to lead or manage teams, to move into the C-suite or change direction in your career, you’d have a good reason to move into permanent.

Equally as compelling would be the need for longer term stability and economic certainty. You may have bought a house, started a family, or had a change in circumstances that make a permanent role right for you.

Just do be aware that you’ll want to have your motivations quite clear, and you’ll need to be able to articulate them to a recruiter and prospective employer. Hiring managers may be wary of those just looking for a paycheck in the short term and shooting off to contracting again when the market turns. But if your motivations are clear, this will not be an issue.

And on a similar point. If you are a contractor and you worry about the longevity of your contract but would consider a permanent role to carry on where you are, you should speak to your recruiter or manager about the prospect.

Good old communication is the key. You should never assume that your manager would automatically consider you for a permanent position. It’s safer to assume the opposite in fact. It could be a win / win for both parties.

But let’s assume that you are a contractor and want to remain so. Is it a time to reduce rates?

Contracting rates are highly variable and you will no doubt be familiar with being asked what rate you contract out at.

If you are not aware with the process, it is very rare for a recruitment company to be given a rate to recruit to. That would be nice, but it doesn’t often work like that.

It is always a ballpark figure range and then it depends upon the right person with the right skills for the role being available. It’s a bit of a mine field really.

Getting the rate right for your experience and the market starts with having a very good rapport with your recruiter. Personally, I’ve used the same recruitment methodology for 20 years. I will ask a contractor about their motivations for a role and how they prioritise them. It’s a set of questions that works equally as well for a helpdesk candidate as it does a CIO. If you’ve ever interviewed with me, you will be familiar with this exercise.

One of the motivations is money, and when we discuss the financials, we’ll drill down on where you think you sit and why and what other considerations you’ll take into account.

You’re an individual and your circumstances are different from everyone else, so between us, we’ll work out your ballpark range.

The actual rate for the role will only be known once all the applicants are in, assessed and compared. Transparency and trust are key. If the client believes that you should be on the shortlist for the role but $ expectations are out of kilter, I’ll be letting you know. It’s then your choice whether to proceed or not.

I’d suggest flexibility when it comes to rates will be prudent over the next 6 months however wholesale drops shouldn’t be warranted.

One thing to consider is the length of contract. A 12-month contract versus a 3-month contract in an economic downturn may be well worth the compromise on rate.

What about Fixed Term Contracting?

This is another option. Salary is going to be on par with a permanent role, perhaps slightly at a premium, usually 10 or 20%. You’ll have some certainty and security, along with paid holidays and kiwi saver but you won’t have made a long-term commitment and can easily move back into regular contracting at the end of the term.

What can I do if I’m between contracts and opportunities are scarce?

This can be a great time for upskilling. We work in the ever-evolving tech world. Attending workshops, webinars, and online courses to learn new technologies and tools is rarely wasted energy.

Becoming certified in your chosen area of expertise can only enhance your employability whether it’s a tight market or not.

There are a few things worth considering when it comes to qualifications. The first, which I think is often overlooked, is the confidence achieving a qualification brings. It is much more than knowing a subject matter.

As we all know, what we learned at school or uni rarely gets used in our work life, but we can take forward the confidence we have from knowing we can apply ourselves and learn the prerequisite skills and knowledge when required.

As a contractor you are probably one of the best in your field, but not all high achievers are confident in themselves. Imposter syndrome amongst high achievers is a very real thing. I’ll do a future video and blog on this subject alone because it’s fascinating to me. Imposter syndrome is described as self-doubt of intellect, skills, or accomplishments among high performing individuals.

Knowing you’re qualified can banish those doubts.

I can speak from personal experience. I verified my expertise with a business degree qualification in 2016. It was a huge achievement for me, and I felt I started operating on a new level. The confidence I felt was reflected in the increased confidence shown in me to deliver at a more senior level and led directly to me having the impetus to start Logical Consulting. Financially I’ve been rewarded many times over the cost of my degree so, if you’re going to invest in anything, invest in yourself!

There’s a slightly more superficial reason too for a good set of certifications on the CV. Your CV may pass through many hands before you get an interview. A candidate manager, a recruitment consultant, an HR manager, the hiring manager, their boss, one of their team, all requiring a nod of approval.

Having the recognised qualification in your profession helps you get those nods. It may be a prerequisite just to be considered, in some cases it may make you a standout candidate.

If you are between contracts, and you do have downtime, then it may be just the opportunity to get those certs refreshed and in line with your next role. Drop me a line if you’d like to know what’s being asked for in your area.

Ok, next:

Building a Strong Network

Sometimes life and work get in the way of maintaining relationships with past clients, and colleagues. And let’s be honest, most of us are not the greatest self-promoters. But our connections, word of mouth referrals, coffee catch ups and professional social media profiles can lead to valuable opportunities.

I use what I call a high-tech / high-touch approach.

High-tech includes my various technologies, integrated, automated where possible, and scalable to keep in contact with as many people as possible.

High-touch is about meeting people individually for coffee, to talk about them, and work out how we can work together. I’m not sure where these conversations will take us, but the universe tends to move and make things happen. Whether it’s the following week or month, another conversation will open just the right opportunity for that person.

Now, it obviously doesn’t work every time, now that would be clever, but I can guarantee it wouldn’t work at all if I didn’t put myself out there.

I placed a contractor last week just this way. 25 years ago, I placed him in his first role as a graduate. 25 years later he’s an accomplished Chief Technology Officer for startup companies, and after a coffee in Browns Bay a few weeks back, out of the blue the perfect role came up. He started last Friday.

We can’t see into the future but the new client, the CTO and I are super excited by the potential of this collaboration. And all it cost me was a flat white.

If I can’t meet for coffee, I video call, if we can’t do that I talk on the phone. Last resort in my book is email – It’s very hard to move the universe by email!

Recruitment Agencies

Become friends with recruitment companies too. Choose a good group of the most reputable and meet as many as possible. Most larger agencies have candidate managers and recruitment consultants. Candidate managers keep in contact with you about availability and normally advertise roles or give you the call if you are already on the database. Recruitment consultants will present your details to the client.

Don’t assume that knowing one person in an agency is enough. Every agency’s intention is to have seamless communications throughout the team, but in practice your CV can be with a person on one side of the office without another person knowing it exists. Once again, coffees, videos, calls, and updates by email are the order of the day to keep in touch. Build that strong relationship and keep yourself front of mind when the right role comes up.

One area to work on is LinkedIn. It can’t be overstated.

As a contractor, you are your own self-contained business, and you need to become a marketing superstar. LinkedIn is huge as a professional networking platform. Most recruitment companies and the internal recruitment teams within corporate companies use LinkedIn Recruiter. It’s an expensive tool so they like to get their money’s worth out of it. It’s the default setting, the go to, to find people and manage their details for future contract opportunities. Looking your best on LinkedIn cannot be overstated.

Once again, this is a whole subject I’ll dedicate a complete session to, but let’s get the basic right:

1 Put a good profile picture up.

3 Make your headline more than just your job title. Mine is Managing Director. Providing business a competitive advantage through the recruitment of high performers in digital, data & analytics. Sourcing better projects with both contract and permanent professionals.

4 Make your About a short story highlighting your skills and achievements. If you feel like it, you can read mine for inspiration :)

5 Get recommendations, from your recruitment agents, your previous hiring manager and former colleagues. I need to practice what I preach here.

6 Keep growing your network by linking to relevant people.

7 If you’re motivated, post articles or comment on articles in areas of your subject matter expertise.

Just as, in fact more important, is the CV.

Another area often overlooked by long term contractors is the gool old CV. After 20 years in an industry and multiple contracts the CV can begin to get unwieldy and possibly irrelevant.

A CV shouldn’t be restricted to just 2 pages, but if it’s longer than 5, it’s probably getting too long. The other thing is that with a wealth of free templates, Canva and other creative tools at our disposal, a plain CV with no graphics can be easily improved with some visual appeal.

The CV is your document. It’s your opportunity to make the best first impression. Using a bit of psychology, not only are people quick to form first impressions, but they are also likely to use unconscious bias to make decisions based on that first impression.

If a hiring manager looks at your 15-page CV for 20 seconds, decides it’s difficult to find the information they need, it’s not hard to imagine that they will move to a candidate with an easier to read, more easily digestible resume.

It’s a good investment to have your CV professionally produced.

Another benefit from this is that you are going to be highlighting everything that’s relevant and cutting the rest out, and this is really going to help with my next top tip.

Interviewing

When you’re in demand and you’ve got multiple offers on the table you can take the interview by Zoom, let the client know you work from home only and up your rate by 25%, life is good.

When the good times are not rolling quite so well you may have applied ½ a dozen times, not had a sniff and then finally made a shortlist with 5 other well qualified applicants. This is where your interview technique will make all the difference.

I have coached countless senior applicants in their interview technique over the years as I believe it’s one of the most valuable skills you can have in your armoury and it’s relatively simple to get right.

It does start with your CV, having that so clear and concise, knowing what is on there and being able to discuss every facet. It is after all, what you are supplying to the interviewer. It’s all they have to go on.

Interview questions are rarely designed to trick. They are either closed, asking for information or confirmation such as “What is your notice period?” “Can you start on Monday?” Are two you want to hear.

Or open questions, such as “Tell me how you deal with difficult stakeholders?” This is a sure-fire question for Project Managers and Bas.

It’s the answers to the common open questions that you must have instant recall on. Taken from one of your recent roles, the most relevant or if you had a standout project. It must answer the question in the most efficient manner.

You’ve probably experienced behavioural interviewing techniques where the questions start with “Tell me about a time when….”

They are answered best using a STAR technique – In depth STAR technique is documented all over Google, ChatGPT and YouTube so I won’t go into too much detail here.

Whether you are asked a behavioural question or not, answer it as a STAR – you give the Situation, your Task, the Actions you took and the Results you got.

Spend 10% on the Situation – The client is a financial institute looking to move from on prem to a pure cloud environment.

10% on the Task – I was brought on to be the Solution Architect to integrate a SaaS Credit Card management System implementation in GCP.

70% on Actions – The bullet points:

• I needed to review legacy systems.
• Document code.
• Review various SaaS applications.
• Map business processes.
• Ensure integration with other core SaaS applications.
• Develop API to integrate with bespoke software.
• Test and put into production environment.

10% on the Result – System fully integrated over 18 months, end of month transaction processing time down to 2 hrs from 1 week. Cost savings of $$$.

With this kind of response, it’s so easy for an interviewer to follow up with the next question.

“So bespoke API development, what challenges did you face?”

And you’d use STAR again… Situation, Task, Actions and Results.

The best part is, you can use the same example, just from a different angle, for every question. If you’re asked about managing 3^rd party suppliers for instance, just jump straight back in.

Both my kids landed their first jobs, first time, as an apprentice electrician and a beauty therapist after being drilled in this technique. A family friend nailed her air hostess entrance interview with Air New Zealand and anyone going for a contract job with Logical will also get the same advice. It’s pretty foolproof once you get it right.

And it’s not about rehearsing anything word for word. It’s about having great examples and answering the question meaningfully, with relevant information. Probably the worst interviews are when a person goes off on a tangent and starts riffing free style – this keeps it bang on track.

On every job description I’ve seen, contract or permanent, it says, must have great communication skills. There’s no better way of demonstrating great communication than explaining the highly technical to the lay person in a simple and concise manner.

So, all you need is one interview opportunity and a track record of 100% interviews to offers ratio to get through any downturn!

And finally – Financial Management and Saving for a rainy day.

Having an emergency fund can provide a safety net during times of income uncertainty.

For my final quote of the day I’ll go to Rudyard Kipling, an excerpt from the poem If. With my apologies to the author, I’ll add the final line.

If you can keep your head when all about you, Are losing theirs and blaming it on you,

If you can trust yourself when all men doubt you, But make allowance for their doubting too;

If you can be disciplined, put in a contingency fund and have some assets in cash, and you’ll keep be able to ride out a downturn in the contracting market.

I hope I’ve given some helpful advice and insights and thank you for taking the time to read this. Please let me know your thoughts and experiences.