Questions we answerHiring and headcount
Should I hire full-time or contract?
Contract buys speed and information; permanent buys accumulation. The right answer depends on how durable the need is and whether you need the knowledge to stay.
Free · a few minutes · starts from “I think we need another person”
The short answer
Contract fits when the work is a defined piece, when you need it done before you can be certain the need is permanent, or when the skill is scarce enough that a permanent hire would take months you do not have. Permanent fits when the work is continuous, central, and depends on context that only builds up inside the team. The question that usually settles it is what you want to be left holding at the end: a contractor leaves with the knowledge unless you plan the handover deliberately.
This is often framed as a cost question and then decided on day rate, which is the least useful way to look at it. A contractor at twice the salaried rate can still be the cheaper decision if it stops you committing to a role that turns out not to exist.
The more useful frame is what each one buys. Contract buys speed, reversibility and information. Permanent buys accumulation — context, relationships and judgement that compound only if the person stays.
Is it really this?
Worth checking before you spend anything. These are the signals that tend to tell the two apart.
Signs it is
- You can name the work but not confidently say it will still exist in a year.
- The skill is scarce and a permanent search would take longer than the work can wait.
- You want to find out what good looks like before writing a permanent role.
Signs it's something else
- The work is plainly permanent and the only reason contract is attractive is that headcount approval is slow.
- The knowledge generated is the point, and losing it at the end would undo the work.
- Nobody owns the work today, in which case neither kind of hire has anything to inherit.
What's usually behind it
- A need that is urgent now and uncertain over twelve months.
- A headcount approval that is hard to get, where contract budget is easier.
- A skill the team has never had, so nobody is confident what a good permanent hire looks like.
What people usually get wrong
- Using a contractor indefinitely for work that turned out to be permanent — more expensive over a year, and nothing left behind.
- Choosing contract to sidestep headcount approval, then finding the role was never properly justified.
- Not planning the handover, so the engagement ends and the knowledge leaves with it.
The options, and when each one fits
In no particular order. Which of these fits depends on your situation, not on the question you typed.
Permanent role
Continuous, central work where context and relationships compound.
Contract or interim
The work is defined, urgent, or you need to learn what the permanent role should be.
Fractional specialist
You need senior judgement a few days a month rather than a full-time person.
When doing nothing is the right call
If you genuinely cannot tell, a short contract engagement is the cheapest way to find out — provided you write down at the start what you expect to know at the end, and what would be handed back. A contract taken to avoid the decision tends to renew quietly for two years.
What the diagnostic asks
- Whether the need is a defined piece of work or an ongoing one.
- How long it has been there and whether it is growing.
- Whether a permanent hire is realistically fundable.
- How soon this needs to be sorted.
“I don't know” is always an answer. Nothing is assumed on your behalf.
The routes it weighs
Every diagnostic weighs all ten routes. These are the ones that tend to matter for this question — a description of the rules, not a promise about your answer.
Recruit
Recruit a new person for a durable, sizeable need that is central to the team.
Specialist support
Bring in a freelancer, consultant or specialist for a defined piece of work.
Outsource
Hand a defined, ongoing scope of work to an external provider.
Do nothing yet
Record the issue, set a revisit date, and decide what would change your mind.
Develop
Build the capability in someone already in the team, with time and support.
What changes the answer
- A durable, growing need that is central to the business pushes towards permanent.
- A need you cannot yet size, or one with a foreseeable end, pushes towards contract.
- A hire that is affordable only at a stretch changes which kind of commitment is wise.
Get your own read
A handful of short questions, then the strongest route for your situation, what's also credible, what we still don't know and what would change our view. No account, no setup.
Related questions
- Should I use a freelancer or hire?A freelancer or specialist fits a defined piece of work or a temporary need. A hire fits a durable, growing one. The diagnostic asks which you have.
- Should I use a fractional executive?Fractional works where you need senior judgement rather than senior capacity, and where someone internal can carry the execution between sessions.
- Should I hire now or wait?Timing is a real decision, not a delay. Hire now when the need is durable and fundable and the role is defined; wait when any of those is still a guess.
- Can I afford to hire right now?Affordability is not the salary. It is the salary plus recruitment, onboarding, management time and the months before the person is productive — against what happens if you do not.
- When should a startup hire its first engineer?When there is durable technical work, someone who can judge technical quality, and enough definition for an engineer to own something rather than wait to be told.
- Should I hire a junior or a senior?Seniority is a decision about how much definition the role comes with. A senior defines the work; a junior needs it defined, and someone with time to do that.