Why do investment banks hire contractors?
by Charles Andrew April 12. 2008 Banks hire IT contractors for a variety of reasons. Often these reasons are driven by a desire to reduce costs and risks and keep the labour force flexible. Other times it’s simply because a specific skills the bank is searching for just cannot be found among its existing staff or among other permanent job seekers. Banks often need specialist skills for various IT and finance projects. When the project ends the contractor’s expertise may no longer be needed. A contractor is hired for a finite time, say 6 months. This allows the bank the flexibility not to extend the contract at the end of the 6 months if there is no more work available. Alternatively, if there is adequate demand, the bank can extend the contract if there is further need for the contractor’s skills. The bank also saves other costs when hiring a contractor as opposed to a permanent employee. There is no employee tax or national insurance to pay and there are no benefits to provide such as
