Pros and Cons of Temp-to-Perm Positions for Employers and Employees

Temp-to-perm positions provide employers and workers with a flexible arrangement that can benefit both parties.

For workers, it offers the opportunity to gain experience and potentially secure a long-term position with a company. For employers, temp-to-perm allows them to fill skills gaps quickly, and often at less cost than traditional hiring.

However, both parties should weigh the benefits and drawbacks of temp-to-perm before deciding if the arrangement best fits their needs.

This guide will review what a temp-to-perm position is, highlight the pros and cons for both the employer and employee, and list popular jobs that often use this type of arrangement.

What is a temporary-to-permanent position?

A temp-to-perm position is a job that starts as a temporary role with the potential to transition into a permanent position.

It is a flexible arrangement in which a company hires a worker through a staffing agency or direct hire for a specific period to fill a temporary need or handle a short-term project. The temporary contract has a predetermined duration (typically a few months).

The company may offer the temporary worker a permanent role if they perform well and the company needs a permanent employee with the same responsibilities. This offer depends on various factors, such as the company's financial situation, the worker's performance, and the need for the position.

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Pros and cons of temp-to-perm positions for employers

If you’re considering hiring temp workers for a temp-to-perm position in your company, there’s good news: The arrangement has many potential benefits, including reducing financial risk and increasing flexibility.

As with any employment decision, there are also potential challenges to consider.

We will explore the pros and cons of temp-to-perm positions for employers to help you make an informed decision.

Pros of temp-to-perm positions for employers

The following is a list of benefits you can expect when considering a temp-to-perm position in your organization.

• Reduced hiring costs. Temp-to-perm positions often have a faster recruitment process than permanent positions. Staffing agencies provide pre-screened candidates, reducing the costs of background checks, reference checks, and other pre-employment screening processes.
• Less risk. By hiring a temporary worker, you can evaluate their skills and performance before making a long-term commitment. This reduces the risk of hiring the wrong person and having to let them go later.
• Increased flexibility. Temporary workers can help you adjust to changes in workload, and you have the option to extend their contracts as needed.
• Time savings. Recruiting permanent employees involves multiple interviews, checks, and negotiations, leading to a lengthy process. However, hiring temporary workers through a staffing agency can save companies time and resources.
• Access to highly skilled workers. By offering temporary positions, companies can tap into a pool of skilled workers who may not be interested in permanent positions but are willing to take on short-term assignments. These workers bring fresh perspectives and new ideas to the company.
• Build a diverse workforce. Working with an agency that has a diverse pool of vetted candidates is an efficient way to build or maintain the diversity on your team. A diverse workforce, coupled with an inclusive environment, increases engagement, productivity, problem solving, and profits.

Cons of temp-to-perm positions for employers

Here are some potential challenges you may encounter when hiring a worker for a temp-to-perm position in your company.

• Reduced loyalty. Given the short-term nature of temp-to-hire positions and lack of long-term job security, temporary workers may not feel as invested in the company or committed to their work as permanent employees. They may even be actively looking for a permanent role that offers job security.
• Higher turnover rate. If the temporary hire is not offered a full-time position at the end of their initial contract, this could cause disruptions to the team and increase turnover.
• Limited availability. It may be difficult to find a temporary worker with the necessary skills and experience for certain positions, such as highly specialized roles or those requiring extensive training.
• Constant training. Since temporary workers are only with the company for a limited time, training them can be a continuous process. This can require team members to devote additional time and resources until the position is permanently filled.
• Costly contract buyout fees. When hiring temp-to-perm workers through a temp agency, note that converting temps to full-time employees can incur contract buyout fees that can be costly. They can be avoided through alternative hiring options instead of relying solely on temp agencies.

Pros and cons of temp-to-perm positions for employees

Looking for new job opportunities? A temp-to-perm position can be an excellent way to explore a company, gain experience, and potentially secure a permanent role.

However, there are some potential downsides to consider before accepting a temp-to-perm work contract. Weigh the pros and cons to determine whether a temp-to-perm position is a good fit for your professional situation.

Pros of temp-to-perm positions for employees

Below are some of the advantages of a temp-to-perm position for employees.

• Opportunity to prove oneself. Temporary positions across a wide range of industries allow workers to showcase their expertise, capabilities, and background, potentially leading to a permanent role.
• Chance to upskill. Temp-to-perm positions offer workers an opportunity to acquire new skills, as they are often project-based and expose them to different tasks and challenges.
• Build a portfolio. Temporary workers can complete projects and assignments to build their portfolios, strengthen their resumes, and increase their chances of landing a permanent position.
• Increased flexibility. These roles often offer more flexibility in terms of work schedule and duration. Workers can choose positions that fit their needs and preferences, whether it's a short-term project or a longer-term assignment.
• Improved work-life balance. Workers can have more control over their schedules, allowing them to tend to personal commitments and obligations outside of work. This can result in reduced stress and better overall well-being.

Cons of temp-to-perm positions for employees

Here are some potential drawbacks of accepting a temp-to-perm position at a company.

• Lack of benefits. Temporary workers typically lack benefits, such as health insurance, retirement plans, or paid time off, which can cause financial strain.
• Limited job security. Temporary positions offer limited job security as they are often project-based, seasonal, or short-term, with no guarantee of a permanent role once the contract ends.
• Lower pay. Temporary workers often get lower pay than full-time employees due to factors like their short-term position, lack of experience or training, and staffing agency fees. However, temporary workers can negotiate their pay or work extra hours to compensate for lower pay.
• Lack of training. Employers may not invest the same level of resources and time into training a temporary worker as they would for a full-time employee. Consequently, they may not have access to the necessary training needed to perform their duties to the best of their abilities.
• Uncertainty. Temporary workers may not know how long their assignment will last or if they will be offered a permanent position. This can create uncertainty about their future job prospects and financial stability.

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10 most popular temp-to-perm jobs

Many industries and job roles offer temp-to-perm positions that can benefit both employers and employees. These positions allow workers to showcase their skills and work ethic while also allowing companies to evaluate their potential as long-term hires.

Below are some of the top temp-to-perm job positions available.

Customer service jobs

Customer service jobs are a popular option for temp-to-perm positions. In this role, individuals assist and support customers, handle complaints and inquiries, and ensure a positive customer experience.

These roles are often required during peak seasons, such as holidays, and are available in diverse sectors, such as health care, retail, and hospitality. In addition, these positions often offer the potential for permanent employment with benefits.

Tax prep jobs

Tax prep season sees a surge in tax-related work as individuals and businesses rush to file their tax returns on time. As a result, organizations like accounting firms and tax preparation services hire temporary tax preparers to handle the increased workload.

Temporary tax preparation positions can provide an excellent opportunity for individuals to gain experience in the financial industry. For example, they may learn valuable accounting, bookkeeping, or financial analysis skills, which could help them secure permanent positions in these fields.

Construction jobs

Construction work typically involves building and repairing structures and is often needed on a per-project basis. Temporary workers are ideal for such projects, as they can provide additional support during seasonal fluctuations or large-scale projects.

Temp-to-perm construction roles offer valuable experience and a chance to showcase skills to potential employers. Moreover, skilled and capable construction workers who excel in their temporary positions may be offered the chance to stay with the company and work year-round.

Software development jobs

Software development is crucial to many industries, including gaming, health care, and finance.

Companies may require temporary workers, such as freelancers or independent contractors, to complete specific software and application development projects that support their operations and improve customer experience.

In cases where there is sufficient work, the company may extend a full-time job offer to proficient and skilled software developers who are already working for them on a temporary basis.

Project management jobs

Project management positions require a worker to oversee the successful completion of specific projects. For example, a project manager in the technology industry may be responsible for overseeing the development and launch of a new software product.

Temporary workers are great for project management roles since they can be hired for the duration of a project and released after completion. A top-performing project manager may be offered a permanent position, particularly in industries with ongoing projects.

Web development jobs

Similar to software development, web developers design visually appealing and functional websites, ensuring a smooth user experience. Temporary web developers can help companies meet project deadlines without committing to long-term employment.

If a web developer's work is found to be exceptional, they may be offered a full-time position to keep working on the site, such as updating content or blogging. Apart from creating websites, web developers can also work on other projects (like developing web applications or building e-commerce platforms).

Research jobs

Research jobs—which may involve market, lab, or any other kind of research—are usually offered by universities or private institutions. Temporary workers like freelancers or independent contractors are ideal for these positions, as they can conduct research for a specific project and then move on to the next one.

Temporary workers who conduct cutting-edge research or perform experiments may be offered a full-time position to work on multiple projects. This makes research jobs a great chance to gain experience and potentially obtain long-term employment in their field.

Teaching jobs

Teaching jobs offer part-time, seasonal, and substitute education positions for temporary workers to gain valuable experience without committing to a long-term contract.

Great temporary teachers who show dedication and expertise in their work may be offered full-time teaching positions. This provides them with stable employment and enables them to advance in their careers and pursue their passion for teaching.

Translator jobs

Translators are often hired to work on specific projects (like translating audio recordings, videos, or written texts), typically on a one-time basis. This presents an excellent opportunity for temporary workers to take on one or more translation assignments.

A company with an ongoing need for translation services may offer the temporary worker a permanent position. This provides an opportunity for a long-term career path in translation and more challenging projects.

Visual merchandiser jobs

Visual merchandisers are professionals who create appealing displays and arrangements in storefronts to attract customers and increase sales. These jobs are often temporary and part-time, designed to carry out a specific marketing project for a business.

Successful projects can lead to full-time employment opportunities, where the visual merchandiser can continue to use their skills to maintain the store's visual identity and drive revenue.

Discover how Upwork Full Time benefits employees and employers

Temp-to-perm positions can be an attractive option for both employers and employees looking for a flexible arrangement that provides an opportunity to evaluate the fit before committing to a full-time role.

If you're an employer seeking a more flexible way to evaluate potential employees before committing to a full-time position, Upwork Full-Time may be a great option for you. This platform allows companies to work with highly skilled professionals on a temporary or part-time basis to assess their skills and cultural fit before extending a permanent job offer.

For job seekers, Upwork Full Time provides a platform to showcase your skills and gain valuable experience working with a variety of clients and industries. It can also serve as a stepping stone to a permanent role with a company that aligns with your career goals and aspirations.

Ready to explore the benefits of Upwork Full-Time and find your next great hire or new career opportunity? Sign up today and discover the power of a flexible and effective temp-to-perm arrangement.