Direct Hire vs Temporary Hire

Today’s job market has opened up huge avenues for temporary employment and as of now, there is a huge temporary workforce that is building all the time. Since the financial meltdown, companies have been more open to temporary staffing rather than availing the traditional direct hire services. So let us pit them against each other and look at their strengths and weaknesses.

Time Period
Contract workers or temp workers are on payrolls of an outside agency, which is funded by the company that offers work. Temporary hires last only for the specific project or contract period, on the other hand a direct hire or a full time employee is a permanent part of the parent company’s workforce and can be let go only if he/she resigns or is fired by the company.

Function and Training
The hiring of temporary workers is often based on the nature of work they are hired for. Contractual or temporary staffing is predominantly seen in case of subsidiary functions or support functions, where as direct hire services are bought in to the picture in case of fulfilling the company’s core competencies.

The other moot point is training, temporary workers are not handed highly-skilled functions, because of the restricted time period they work for and the money invested in training them goes abegging.

Features, Taxes and Benefits
The biggest reason to choose temporary workers over direct hires is the emoluments paid to them. Full-time employees command to be paid a full-time salary along with any applicable State and Federal taxes. They also need to be offered additional benefits like life and medical insurance. Temporary workers are paid for their services offered in a stipulated time-frame and the taxes applicable for their employment in comparison to full-time employees is negligible.

The Employee Point of View
The employee’s take on both kinds of staffing is also undergoing a sea change; the traditional employee was always on the lookout for a permanent and stable job that offers job security. In today’s scenario, a temporary job offers excellent pay sometimes even upstaging a full-time salary and also offers flexibility. A temporary job, by some is seen as a fill-in job, while they are always on the lookout for full-time employment.