Should Your Startup Hire Contractors or Employees?

There are pros and cons to hiring either contractors or permanent employees. If you’re planning a startup, you need to be careful about every person you hire and each dime you spend.

Hiring the right permanent team from the beginning is vital, especially if you don’t do business in an at-will state. On the other hand, you’re probably going to have to pay contractors more because they don’t receive job security or benefits that are available to permanent employees.

Which direction should you go?

There are some instances when you’ll need more from a worker in the beginning, such as when you’re getting your website ready to launch or working on your SEO. While web presence needs routine maintenance and analysis, it isn’t necessarily a full-time job after launch.

In this case, it might be best to choose a reputable website design contractor who only works the hours (and jobs) you need at any given time. But with other employees, it’s not as clear cut.

Good contractor options

Depending on the size and budget for your startup, you may be able to use an firm company or contractor for your HR needs. When it comes to hiring employees, handling worker disputes, and enforcing the laws (federal, local, and within your business), the situation can get very complicated, which is why an HR go-to person is essential.

You might also be able to get away with contracting an accountant, at least in the early years. For startups looking to maintain a blog as part of their online presence, you can’t assume your web designer is the best person for the job.

There are particular skills that designers and bloggers don’t always share. Instead, contract with a professional blogger and SEO professional (which could be one and the same) and optimize your presence to start building your audience.

Don’t assume writing is an easy task that you or a partner can take on in house; quality content is the foundation of a professional online image.

When it’s better to go permanent

Technically, you can outsource just about anything, whether it’s administrative staff or call center workers. However, your administrative branch should be a key and permanent part of your business.

This also goes for anyone behind the other major components of your company. For example, if you’re opening a physical therapy clinic, permanent physical therapists can help build the business. Letting them basically lease offices (similar to the way many beauty salons operate) doesn’t get them vested in the company and can lead to high turnover, chaos, and unhappy patients.

Permanent employees should be selected carefully so ideally they share your vision for the growth of the business. They should be diverse, both in their skill sets and personality, in order to make your business environment as steady and solid as possible.

Don’t be in a rush to hire; think about the advantages of contracting until you find the right fit. The best match will be worth the wait.

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