Not every role should be filled the same way. One of the first calls an employer makes is whether to hire someone permanently or bring them in on a contract — and it shapes your cost, your speed, and how easily you can scale. Here’s a plain-English guide to the two models and when each one fits.
What “permanent” really means
A permanent hire joins your company directly, on your payroll, with no fixed end date. They’re your employee — you handle their salary, CPF and benefits, and they’re there for the long haul. It’s the right model for core roles you’re building the business around. See permanent recruitment.
What “contract” (or temp) really means
A contract worker is engaged for a fixed period or a specific project. Often they sit on the agency’s payroll — so the agency is the legal employer and handles salary, CPF and admin, while the person works under your direction. It’s built for flexibility: ramp up when you need to, wind down when the work is done. See contract & temp staffing.
When permanent makes sense
- The role is core to your business and ongoing.
- You want to invest in someone’s growth and retention.
- Institutional knowledge and culture fit matter over time.
When contract makes sense
- The work is a project, a peak season, or cover for leave.
- You need people quickly, or headcount is capped.
- Demand is uncertain and you want to stay flexible.
The cost & commitment trade-off
Permanent hiring usually means a one-off placement fee plus a long-term salary commitment — you’re investing in someone who stays. Contract is an ongoing rate that bundles salary, statutory costs and the agency’s margin, with far less commitment and easy scaling up or down. Neither is “cheaper” outright — it depends on how long you need the person and how certain the work is. (For how fees are structured, see our guide on what a recruitment agency costs.)
At a glance
| Permanent | Contract | |
|---|---|---|
| Best for | Core, ongoing roles | Projects, peaks, cover |
| Legal employer | You | Often the agency |
| Commitment | Long-term | Flexible / fixed-term |
| Cost shape | One-off fee + salary | Ongoing bundled rate |
| Speed to start | Considered | Usually faster |
Can you run both? Usually, yes.
Most well-run teams do exactly that: a permanent core for the roles that carry the business, plus a contract layer that flexes with demand. If you’d rather not manage the contract layer yourself, an outsourced manpower arrangement hands the employment, payroll and admin to us while you direct the work.
How JTE helps
We do both — permanent search, contract and temp staffing, and fully outsourced teams — so the conversation starts with what you’re trying to achieve, not which product to buy. Tell us the role and the timeframe, and we’ll point you to the model that actually fits.