Waiting for the perfect permanent role after a layoff can take months. A three to six month contract can bridge the gap, pay the bills and keep your CV moving forward. 🌉 For many IT professionals, contracting after a redundancy turns out to be one of the best career moves they make.
Here is how to use contracting as a bridge, how to find contracts quickly and how to turn one into something longer if you want to.
Why contracting works after a layoff
- Speed. Contract hiring often moves in days rather than weeks. Many contract interviews lead to an offer within a week.
- Momentum. You avoid a long gap on your CV and keep your skills sharp.
- Income. Day rates can be attractive, especially for specialist skills.
- Try before you buy. You get to see a team and organisation from the inside. Many contracts convert to permanent roles.
- Confidence. Being productive again is good for your head after a redundancy.
The trade-offs
- No paid annual or sick leave
- Less job security, and contracts can end early
- You may need to manage your own tax and super, depending on structure
- Gaps between contracts are possible
None of these are deal breakers, but plan for them. Keep part of your redundancy payout as a buffer.
How to find contracts fast
- Tell recruiters you are open to contract. Be clear about your available start date, location, hybrid preferences and target rate.
- Set a realistic day rate. Research the market for your skill set. Our day rates guide explains how to calculate one.
- Decide on your structure. PAYG through an agency is the simplest way to start. ABN and Pty Ltd options have pros and cons. See ABN vs Pty Ltd vs PAYG.
- Have referees ready. Contract hiring managers often check references within a day.
- Tailor your CV for contract roles. Lead with the outcomes you deliver quickly, the tools you know and the environments you have worked in.
- Be available. Answer calls and emails quickly. In contracting, speed wins.
Where contract demand is strongest
Contract roles are common in government programs, banking and insurance transformation, telco projects, ERP implementations (SAP, Dynamics, Workday), ServiceNow and Salesforce work, cloud migrations and cyber uplift programs. Note that federal government agencies are reducing contractor spend, so it is worth also looking at state government and the private sector.
Turning a contract into a permanent role
- Deliver early wins. Show value in the first few weeks.
- Be easy to work with. Reliability and attitude matter as much as skill.
- Build relationships beyond your immediate team.
- Say what you want. Around the halfway point, let your manager know you would be open to staying.
- Keep your recruiter in the loop so they can help negotiate a conversion.
Many of our permanent placements started as contracts. Employers like contract-to-permanent because both sides get to test the fit.
A typical bridge timeline
| Timeframe | What happens |
|---|---|
| Weeks 1 to 2 | Reset, update CV, tell recruiters you are open to contract |
| Weeks 2 to 4 | Interviews and a contract offer |
| Months 1 to 6 | Deliver, learn, build relationships |
| Month 4 onwards | Discuss extension, conversion or next role |
Common mistakes
- Setting a day rate based on your old salary divided by 230, without allowing for leave and gaps
- Taking the first contract regardless of fit
- Not keeping a financial buffer
- Disappearing from the job market once the contract starts
Real example: from layoff to permanent in five months
A test analyst lost his role when a telco moved testing offshore. Rather than wait for a permanent role, he took a four-month contract on a state government payroll project, where he learned test automation with the team’s framework. He delivered early, volunteered to automate a painful regression suite and told his manager at the three-month mark that he would love to stay. The agency offered him a permanent automation engineer role. The contract did not just pay the bills, it changed his career direction.
Contracting checklist
- Calculate a realistic day rate that allows for leave and gaps
- Choose PAYG, ABN or Pty Ltd and get advice if needed
- Prepare a contract-focused CV
- Line up two or three referees
- Tell two or three specialist recruiters you are available
- Keep a three-month financial buffer
- Set a reminder to review extension or next steps two months before the end date
Frequently asked questions
Is contracting a good idea after a redundancy?
For many IT professionals, yes. It provides income quickly, keeps skills current and can lead to permanent roles.
Do I need an ABN to contract?
No. Many contractors work PAYG through a recruitment agency, which handles tax and super deductions.
Can a contract turn into a permanent job?
Often. Deliver well, build relationships and let your manager know you are interested.
👉 Ready for your next move? Browse open IT jobs or register your CV and a Zone IT recruiter will be in touch.
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