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Contract vs. Hire: How Small Businesses Are Approaching Software Development

Last updated: Apr 27, 2022 | Categories:
software engineers hire or contract

Research shows that bringing on contractors is particularly beneficial for small businesses

Are you a small business leader or entrepreneur seeking a software development team that won’t bog you down with traditional employee overhead or an unnecessary long-term commitment? While it’s true that hiring software development teams can be a good fit for large businesses, research consistently shows that smaller companies, in particular, find success working with contractors. That’s where American Web Devs comes in: We center our code around your goals and cut out the downtime, lag, and overhead that can be hindrances to the productivity of traditional hires. 

According to the U.S. Bureau of Labor Statistics, contractors overwhelmingly prefer their work arrangement to traditional jobs. 79% of contract workers report higher job satisfaction in their work, and fewer than 1 in 10 contractors would prefer a traditional work arrangement (BLS). Happy workers are productive workers, so these statistics point straight to hiring contractors over employees if you want to partner with the happiest and most motivated sector of the U.S. workforce.

In addition to high motivation and job satisfaction, studies show that contractors reduce overhead and are a particularly good option for small businesses. A recent survey found that companies with 1 to 4 employees utilize the most contractors and that industries from trade to transportation to utilities have seen significant benefits to working with contractors (Paychex). John Hudson of Security Consulting Solutions, Inc in Pittsburgh says contractors bring focused skillsets and domain expertise for specific projects and help in protecting his own time—but only if there’s deep-seated trust.

“Just like employees, there are good and bad apples when it comes to contractors. They can extend your capabilities, so your company can get more done, have happier customers, and significantly increase your bottom line. But especially with software development, you have to be able to trust your contractors, and having excellent communication is critical. We work with American Web Devs because they “get it.” We tell them what we want, and they build it! It’s simple, and we don’t have to worry about the nuts and bolts.”

Though large businesses like Google and Apple also use contractors, it’s clear that small businesses really reap the rewards of the non-employee workforce model. An article in Entrepreneur magazine points to three outstanding reasons to go with contractors: 

  1. The business does not have employees available to perform the tasks 
  2. Demand is uncertain 
  3. The job requires a specialized skill that the company lacks or the business owner doesn’t plan to specialize in. 

Plus, small business leaders often don’t have time to hire and lead a software development team properly, and it isn’t practical to hire staff (or even one employee) who may be underutilized after a development or implementation project. American Web Devs lives in the space between DIY and full-time hires.  

Half of the American workforce will be made up of contract workers and freelancers by 2028 (NPR), so getting on board with an increasingly flexible workforce should be on every entrepreneur’s to-do list. American Web Devs is veteran-owned, and we pride ourselves on doing all of our work close to home. Let us be your neighbor, in software development and bottom-line success. 

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