when i worked for an australian bank, one co-worker in a nearby team had been working on the the banks systems as a sysadmin for over a decade.
the bank would go through cycles of "we need to reduce our headcount and outsource everything" and then 4 years later "we need to reduce spend on contractors and retain more knowledge and expertise in house". he'd survived multiple waves of it, switching back and forth between being an employee or a contractor through some external agency, as management trends changed, while essentially doing the same job.
I want through the same processen three times already.
I work in civil service but in a very specific job that needs certain degrees by law.
I've heard they were going to outsource my job (because civil servant are expensive) and registered a company that delivers the requested services. I entered a public procurement and upped my price a little because I knew there aren't many people with the right certifications. I won the public procurement and went from a civil servant to a self employed expert with a company car and all the perks.
Near the end of my contract they thought about hiring their own expert again because... money.
I applied for the job and went through an external hiring process and got selected. Because legislation changed my job went from middle management to a senior management position with extra benefits. Had to drop the car though...
A few months ago my colleagues were doing prekilinary budget talks and considered on finding an external company to do my job and getting me another position. I had to point out the cycle they fell into and somehow they forgot about it.
I love this, reminds me of a automation engineer, i got to see on quite a few projects, who always came in wearing the company t-shirt or jacket of the sending company. Its so funny, when its always the same guy coming in for different companies.
That's actual genius. You should write this up in detail!
It's hardly complicated!
OP is simply describing what is common throughout government in the UK. This is known as the Revolving Door.
Private Eye magazine wrote a special report on it some years back as, frankly, it is scandalous https://www.private-eye.co.uk/pictures/special_reports/revol... [PDF]
The revolving door is a completely different phenomenon, and it is a problem for a completely different reason. It's about politicians in positions of power over an industry later becoming business leaders or highly paid consultants in said industry. This is a huge problem because it works as a long-term bribe: instead of paying for the politician today and inviting inquiries and problems, you make an implicit promise to employ them when they get out of power as a future reward for preferential treatment today. This is an issue of corruption and excessive business influence of public policy.
In contrast, the issue with civil servants being let go and re-hired as contractors is a simple issue of inefficiency. The same person doing the same job has the same incentives, they're not being corrupted. However, our public resources are being spent inefficiently to hire the same person to do the same job for more money, with an added bonus of spending resources on the acquisition process itself.
Not to take away from your point, but the revolving door is also good because the experts should be the ones who make the rules. There are too many details about every niche that smart non-experts will get wrong and so we need experts.
Good luck reconciling these two conflicting points.
I don't think that's hard to reconcile - that only involves people in industry moving to government, which is far less problematic.
What happens after the job they were hired to do is complete?
I didn't say it is complicated. It is unusual for individuals not at the top of the ladder to set up their own companies and get exactly the same job twice. That's not what the "revolving door" is typically talking about.
Prompted and delivered!
Managers love the idea that contractors can be fired more easily than employees. Except that this flexibility comes at a cost; people insist on being paid more to have an insecure job.
The uncertainty never goes away. You can pay someone else to suffer it, but it will always cost more than dealing with it yourself.
And that can be ok. Just don't fool yourself into thinking you're getting a bargain.
> Managers love the idea that contractors can be fired more easily than employees. Except that this flexibility comes at a cost; people insist on being paid more to have an insecure job.
This is true, but it's not the whole of it. In some cases the manager goes to a cabin in the woods to drunkenly shoot at moose with the head of the contracting company.
It's a saying that "the purpose of a system is what it does". I think it's a pretty dumb saying. But it is often worth talking a look at a system and see if the "mistakes" it makes (such as wasting money on contacting companies) aren't in fact desired by some people in the system.
There’s a tricky variable called trust. As an employee hiring consultants, how do I build trust that you and your consultancy is going go deliver and make me look good? It usually involves building a relationship, activities like hunting or golf are classic examples of these activities.
> if the "mistakes" it makes [...] aren't in fact desired by some people in the system
This process goes both ways. The people in the system align to the process. So maybe the "mistake" wasn't desired to begin with, but once it's there someone things: if that's the way they want it let's change our ways to fit. That's why these things seem to dumb from the outside.
This doesn't happen nearly as often as people think. I'm involved in multiple single digit million contracts with vendors, and not once has anyone at our company even met the vendor AMs in person. If I choose a vendor that is twice as expensive as a competitor I am going to have to justify that to the VP I report to and "we had fun on the golf course" is just not going to cut it.
There's always going to be a slight mismatch between the supposed aim of any organisation and the incentives of the management and every single employee unless they're all shareholders and even then...
> Managers love the idea that contractors can be fired more easily than employees. Except that this flexibility comes at a cost;
I noticed this early, and spent the first half of my career leaning into it. If you negotiate every gig as a contract, you get to double (or more) your salary. And the only thing you're trading away is job security which, if you pay attention, you'll notice doesn't actually exist for your salaried counterparts either.
To nitpick, you also have to pay for your own health insurance. So subtract $200/month from that extra $15,000/month for the sort of catastrophic coverage plan that a 27 year old needs.
What happened that made you switch away from contracting?
The problem was that every time I stopped contracting for somebody, they stopped sending me money. Building software products fixed that:
https://expatsoftware.com/articles/guy-on-the-beach-with-a-l...
I remember your blogabond posts from way back when on HN. I think you were the first to really popularize the "coding while traveling" idea.
I didn’t get to use any of the cool terms for what I was doing though. FIRE and Digital Nomadding hadn’t been invented yet.
I've seen this happen because of accounting/corporate finance policy.
Payroll is an ongoing commitment. Consultancy is a temporary service. Moving people from payroll to consultancy means they can reduce overhead in financial projections. Even though consultancy costs more, and employs the same people, it makes sense to do if it means you can convince shareholders and analysts that Opex will shrink in the future, and therefore profitability increase, and therefore the share price increases.
The problem arises when moving someone from payroll to consulting creates the illusion they are not necessary.
That's not Accounting's problem.
This is one of the many situations where counting beans creates idiocies, because GAAP has no concept of context, and management can play games to make the numbers look good while destroying real value.
That's Level 1 of the problem.
Level 2 is conscious fraud, either of investors or by investors. There are always startups that look suspiciously like their only purpose is to extract money from investors based on future promises that are... unlikely.
You can spot them because the promises keep being delayed, and/or they pivot to some other activity, but keep pretending to be a serious viable business with Exciting Plans™.
Level 3 is the one described by OP, where startups are cynically used by an incubator to extract fees and other income. This can overlap with genuine investment. It can be a triple win. No IPO? A nice cut of investor money. Unicorn IPO? A nice cut of a different kind of investor money. Successful business? A nice cut of the income stream.
Level 4 is straightforward investment fraud by banks and brokers. There are many, many variations on this, from "questionable relationship practices" to risk washing, to outright pump 'n dump, and even the occasional classic Ponzi.
The bottom line is that capitalism is inherently corrupt. There is no free market of rational actors inventing wealth and value for a glorious shared future.
There's an infestation of opportunists, fraudsters, and hucksters at all levels, and governments regularly have to step in to hide the mess and glue the pieces back together - sometimes because the people involved own parts of the government too, and it's better to make millions of working people poor than to go to jail.
> capitalism is inherently corrupt
People are inherently corrupt. That's just life. The Soviet Union was corrupt as hell.
If you want to put down capitalism, feel free, but don't blame it for something that isn't unique to it.
At a glance, maybe. But we also see this in government. The US has outsourced 10s of thousands of “permanent” jobs over the decades. The entire DC metro economy is based on this.
Also because of corporate policy. I know of a company where the VPs are heavily targeted on headcount reductions. Contractors are not headcount.
> if it means you can convince shareholders and analysts that Opex will shrink in the future
Isn't that just fraud?
No. Fraud is a much higher bar than making a prediction about your plan for the future that may or may not pan out. There’s no deception here, management fully intend to end the contractor relationship in future, whether they’re able to or not.
A vague promise which you pretend to beleave and can make believable to other is just business advice unfortunately.
It doesn't actually make sense tho. It just "makes sense" within the rules of a fundamentally nonsensical system.
That system however is no law of nature. It's just broken nonsense no one bothers to fix because we haven't yet run out of money.
I wonder if this explains why I hear about this more from Europeans than from the SF tech scene. California is at-will employment, so you can fire an employee as easily as a contractor. Ironically this makes companies more willing to hire and retain employees, since they're not worried about getting stuck with a bad one — and most employees aren't bad, and are better for the company than contractors.
Its not about employees being bad, we have 6 month trial periods over here in the EU where you can be fired quite easily. Thats the excuse they use to keep at will employment. In reality they want to be able to reduce Opex costs which looks great on their end of year budgets. If you can then offload that cost into a project run under Capex, even at a higher cost, then its budgeted differently and the shareholders get their payout.
A stable environment with a great culture has lower costs.
But then they have to hire good managers and for that you need to be a good manager yourself.
The cynical me believes that there's not way kickbacks are not involved. A lot of times a third company acts as an intermediate on hiring those contractors, and their fees and markup easily make the same worker costs sometimes 2x their original salary.
The usual excuse for that is that labor is classified as OPEX, while hiring consulting companies can be classified as CAPEX, and the stock market likes when companies lower their labor costs to "invest" more.
Have y'all hit the "can genai do his job?" phase yet...
Early on I used to try to explain that things don't work as advertised. There are a lot of advantages but you need a human reviewing and directing.
These days I don't even bother. Call it being desensitized to the bullshit, but I'm waiting for some fancy AI agent to take out stuff in a way that no one can do anything. Past that I don't see a way for C suite to wake up.
> Past that I don't see a way for C suite to wake up.
Didn't you mean to temporarily realign? I mean give it 2 years and another manager to show up, ready to get their bonus for the next attempt at it.
That's our reality and how we've structured our markets
I honestly don’t get why anyone would give up their mental health like that and work for such places. In my reality there are plenty of honest and decent places to work at. I’m seen dark places yes but only as visitor - why would I want to be in hell for more than a day or two.
There's the thought that all places are potentially s** in one way or another. This isn't entirely true but there's a significant possibility that any move could be just as bad or worse.
You look at your monthly outgoings and think about how long you have to look before your cash runs out.
I stuck it out too long several times. The most recent one left me unemployed for quite a long time and I was lucky to be in a position for it not to matter.
Now I'm in a job that's a step down - in a sense it's humiliating. On the other hand it more than pays the bills, it's low stress, I've lost 13 kg and I don't wake up in the middle of the night and instantly start thinking of the terrible things that happened in the week so that I can't sleep again.
Now I spend my spare time working in the garden instead of desperately trying to build the new feature on time. I'm digging a driveway. Perhaps this won't last but I realise how much I was killing myself by trying to stay in something bad.
Places are bad essentially because of bad people - it only takes a couple of idiots and it's impossible to fully judge that from an interview. You always get bad vibes from someone or other but you're trying to convince yourself it's ok because you need a job.
I don't see why that'd be humiliating by any sense of the word. We don't live long, and there's pretty much nobody who at the end of their life bemoans 'I sure regret not having spent even more time at the office.' More humiliating, at least from my perspective, is the person who works their life away, trying to find contentment from the accumulating of things which, of course, never succeeds. It's like society is full of people playing out what used to be the comical trope of a man in a mid-life crisis, and his new yellow convertible.
> I honestly don’t get why anyone would give up their mental health like that and work for such places.
Mostly for money, of course. And all the attendant improvements that can bring to one's life. Some people need it more than others, e.g. a H1B worker who is attempting to pull a whole family out of poverty.
I bet many go in thinking they will do it temporarily, until they pay their college debt, to give one example. But money is very addictive.
I agree with you, but I feel like leaving is much harder in reality for most people.
Life gets in the way, you don't have the energy to apply, you're afraid of rejection, you are afraid you might end up in a worse environment, you justify it to yourself in any number of ways.
Inertia, herd mentality and self-deception are much more powerful IRL than most people online seem to think (or at least write).
Add having a family to the mix and it gets worse. Being a sole provider for a family is scary when you go job hunting, especially if you live in an environment that is very expensive (where the jobs that pay decent are located normally).
Yep, I left one project because I think I was underpaid there. I could not find another job for like 3 months. I finally found one and I was also very stressful. No it is better, at the same project and I think I make more money than I would ever be able in a project I left. But on the other hand it was very stressful for my family. Was it worth it in the end? I do not know because even if money is better and company is bigger I could damage my kids development by being angry, sad and depressed for two years.
Because companies tend to enshittify over time. Especially if they get acquired. Doubly so if the buying company is PE.
Really small “lifestyle” companies might be fairly immune, but it doesn’t take much for them to fail, there’s a different risk profile.
> In my reality there are plenty of honest and decent places to work at.
Like wich? In my experience all workplaces have something that's gonna be wrong with them, and you just need to compromise if what's wrong with THAT ONE is acceptable to you.
Like for example honest and decent places to work at tend to also come with lower pay, or pigeon-holing career-limiting type of work, discriminatory gatekeeping, or other such compromises. There's no free lunch where you can have your cake and eat it too, unless you're very lucky.
Many times places change because a manager changed and then you have the boiling frog thing where it doesn't become awful all at once.
At some point I just work here man, and my job is to do whatever dumb shit management wants me to do this quarter, no matter how dumb it is.
I think it is that cycle where old projects will eventually seem less important with huge budgets for new projects by a new manager, that will have bigger allocations, and the bonuses will follow along with the brownie points to that genius.
This is what I do believe will happen.
I still have new „business„ guys joining org who try to make „cloud migration”.
We are cloud as a SaaS, we are running on VPS with virtual networks. But they come in and think „to be professional” we should be in „real cloud” like Azure or AWS.
Just got my morning coffee and read "genai" like some elusive Japanese person's name.
So, can Genai san do his job?
That's a pet peeve of mine with improper capitalization surrounding this. AI = Artificial Intelligence. Ai = a Japanese name. ai = "love" in Japanese.
Also, "jenai" (which sounds like an uncapitalized "genai") means "not."
> So, can Genai san do his job?
If not, will become Genai Sans job.
Oh stop it.
In my defense, it was Father's Day and I had to.
Sir Humphrey explains the role of a civil servant
https://www.youtube.com/watch?v=wKDdLWAdcbM
"Bernard, I have served eleven governments in the past thirty years. If I had believed in all their policies, I would have been passionately committed to keeping out of the Common Market, and passionately committed to going into it. I would have been utterly convinced of the rightness of nationalising steel. And of denationalising it and renationalising it. On capital punishment, I'd have been a fervent retentionist and an ardent abolitionist. I would've been a Keynesian and a Friedmanite, a grammar school preserver and destroyer, a nationalisation freak and a privatisation maniac; but above all, I would have been a stark, staring, raving schizophrenic."
I hope he was able to get a paybump each switch!
Sometimes(most of the time?) that is the only way to get a pay bump.
I know a large public sector organisation that had two extremely experience engineers take an early retirement package because there was a big restructure and they were getting 20 grand under private market rates. Six months later, they're hired back in for a year at 20 grand *over* market as contractors.
And they wonder why they're pissing out money like a drunk in a bus stop.
Did that include the ~40% of employee overhead?
This is what I do.
I love watching them cringe when they see my new daily rate.
Something I hated about working in corporate America was surviving multiple leadership regimes, watching the same lessons being learned over and over, having to recount history to new regimes, it got really tiring, and particularly dealing with the attitudes and self regard of some.
I have often thought this - a wave of people learn something and on come the next wave to relearn it all. They can read books but they don't really "get" what the books say and have to learn it all from personal experience all over again. It's not just America.