[hibikir]

temp work with the possibility of extension is very common around here for both ends of the skill spectrum. The lower end is hard to evaluate, so companies give themselves an out that is not called a layoff. On the high end, accounting comes into play: Consulting fits a different bucket than full time employees, so often it's much easier to hire a consultant and pay him well than to hire the same person full time.

I look at my own current job. I was offered a full time position 6 months ago, for an amount that is pretty in line with local salaries. As a consultant, they were able to offer me a whooping 60% more, and that's after I accounted for all the benefits of the full time position.

I find it pretty screwed up, but it is the realities of the local job market, where very senior full time devs are severely underpaid unless the are consultants or telecommuting for bay area companies.

[Mister_Snuggles]

Unfortunately, this is very true. I don't understand why it's considered "cheaper" to pay more money to a consultant than the salary+overhead of a regular employee. I get that they're different parts of the budget, but ultimately it's still money spent by the organization.

[Silhouette]

It's not necessarily cheaper, but in a large organisation it could well be easier in practice.

The person making the hiring/firing decisions probably isn't responsible for the bottom line. They'll be working within defined constraints on what they are authorised to do and how much they are authorised to spend on doing it. If they want to go outside those constraints, they probably have to follow a standard procedure to request authorisation to do so, which may well involve legal as well as accounting approval, explicit approval from management at increasing levels of seniority depending on the request, etc.

If senior management haven't kept a careful eye on how their policies are actually being implemented, this can easily create perverse incentives where doing something is favourable to the person making the decision even though it is less favourable for the overall success of the organisation. The current example, hiring expensive contractors for very long term gigs instead of salaried staff, is not unusual.

Other similar results of potential interest to geeks would be things like renting SaaS rather than buying (often more expensive in the long run, but done because the relatively low recurring opex is preferred to relatively high up-front capex) and buying commercial software from a preferred supplier rather than using something Open Source for free (because preferred suppliers have been pre-vetted and approved so their product can be bought immediately, while using someone's FOSS might need legal to review the licence if it's one they haven't seen before, which can involve all kinds of "business justification" paperwork and extensive delays).

Edited to add: Of course, there may be other factors as well. Contractors might be more expensive per day but often don't come with the long-term legal obligations of hiring an employee (a big deal in places with relatively strong employment rights laws, such as most of Europe). For software purchases there may be issues of ongoing support contracts or (re)training and migration costs that dominate the total cost of ownership, making rent/buy or COTS/FOSS decisions a relatively minor factor. Sometimes the incentives set up by senior management who are looking at the big picture aren't as perverse as they look from below.

[falcolas]

> As a consultant, they were able to offer me a whooping 60% more, and that's after I accounted for all the benefits of the full time position.

As a consultant, you're responsible for paying taxes that they would normally pay, which when combined with other benefits represents up to 50% of your total salary as a normal employee. You also lose out on a number of legal protections you gain as a regular employee.