The world of work is changing rapidly. We see the major tech companies laying off tens of thousands of overpaid local engineers. The global workforce was brought top of mind with the pandemic, and it's been a long time trend. I saw some of this change over a decade ago with competitions for labor as an employee of TopCoder. Seeing some of the smartest engineers in the world do weeks of work for a chance at getting paid the prize was eye opening. I suggest taking the best of both worlds by hiring fractional executives and specialist contractors. Here I lay out the reasons to hire part time (1099/corp to corp/cash) vs full time (w2/salaried).
The most compelling reason to hire fractional and part time contractors is expertise. You can find the top 1% in the world at a given skill, and pay them to execute only that for you. Supplementing the work force with those at the top of their game makes for better delivery. It's clearly better to pay someone $200 / hour for two hours of perfect code integrating the exact library you need, than pay $40 for 10 hours of generic work that is off the mark. This is an obvious cost savings by using the best talent, but it also makes sure you only pay for productive work. There are so many ancillary costs associated with full time employees. Vacation time, disability insurance (not to mention disability leave), child leave, bereavement, and other allowances. With a contractor you pay for what you get, if they're not working, they don't add to your burn rate.
Depending on the structure, contractors generally have multiple clients. Most workers in this new paradigm prefer this. It gives them freedom to increase and decrease their workload week to week. Gives them significantly more security to the whim of a single manager. And lets them demand things from their clients based on their level of expertise. As the business owner, your demand can vary from week to week, and it is often accommodated by the contractors juggling other work, or you can hire more contractors during peak times. Peripheral benefits no longer exist, gym stipends, rental cars, EAPs, etc don't have to be administered and paid for. There is less risk of lawsuits like discrimination.
By maintaining a modular workplace, it forces the engineering culture to constantly contend with the bus issue. Standard teams have to make sure the company won't be set back significantly if a key team member is hit by a bus. When you have a modular team with members coming in and out, and working part time, you naturally document better, keep the code cleaner so new engineers can come up to speed. This is better for code hygiene and culture overall.
Full time employees
The best reason to hire full time is it gives access to employees that don't exist in the contractor marketplace. Some personality types just want to be employees, and they won't adapt to the new form of employment anytime soon. This grants a certain type of loyalty. It seems many employees are wiser these days after seeing lay offs with zero notice, and the anti rewards for company loyalty. With a full time staff, you also get a predictable burn rate and output level. Burn is likely higher, and output level is more stable and less able to adapt to needs, but predictability has its advantages. There is also likely less turnover, because the investment in getting a full time job is higher.
There are many reasons to engage your workforce in the new paradigm of fractional and contract work. My company is comprised solely of part time workers. I find the risk and cost advantages outweigh any downsides. Reach out if you want to hire me in a fractional capacity, or learn more about this philosophy.