Contract vs. permanent vs. self-employment: What is best for pilots?

Pilots often face critical decisions when choosing a job. Should you pursue a contract or a permanent position? The choice shapes your career, lifestyle, and financial future. Do you want flexibility or stability? Are short-term rewards more important, or do you prefer long-term security? 

Knowing what matters most will guide your decision. This article breaks down the key differences between contract and permanent employment for pilots. You will get a clear comparison, so you can make a confident choice.

What are pilot employment types?

Pilots typically have two main employment options: contract or permanent positions. There is also a third type of employment distinct from the other two. Before exploring the pros and cons of each, let’s first familiarize ourselves with what each type of pilot employment offers.

1. Contract employment for pilots

Contract employment means a pilot works for an airline or company for a set period or specific project. The employer and pilot agree on the length, pay, and responsibilities upfront. When do airlines offer contract jobs? Commercial airlines usually hire extra pilots on temporary contracts during busy seasons or special events to meet high demand. Contract pilots may also cover for permanent staff on leave. Additionally, they might assist with government and military projects.

What are the benefits of contract employment for pilots?

Contract employment offers pilots both opportunities and challenges. It gives them more control over their work life but also comes with some trade-offs.

• Higher salary. One of the biggest benefits of contract work is the potential for a higher salary. Since contractors are often hired for specific, short-term roles, employers usually offer more competitive pay rates to attract experienced pilots. Contract pilots can also negotiate pay per flight hour, which can be more profitable than a permanent salary.
• Schedule flexibility. Contract pilots have more control over their schedules. They can decide when and where to work, which is a major advantage for those who value flexibility. For example, a contract pilot could take time off between jobs to travel or focus on personal projects.
• Diverse experience. Working as a contractor lets pilots fly different types of aircraft, experience various operations, and work in different flying environments. This variety helps build a unique skill set and can enhance a pilot’s resume, especially if they plan to move into a more specialized role later.
• Variety of employers. Contractors are not tied to one employer. They can work with various airlines, private companies, or even in different aviation sectors. This offers valuable networking opportunities and helps expand a pilot’s professional connections. 

What are the drawbacks of contract employment for pilots?

However, each benefit comes with a downside, which may be a dealbreaker for pilots seeking long-term job stability and benefits:

• Lack of job security. Contract pilots may face the challenge of job insecurity. Once a contract ends, pilots must immediately search for another opportunity. While this can be an exciting option for some, it can also be stressful, particularly if the job market is unstable.
• No employee benefits. Pilots who operate flights on a contract basis, usually do not receive the same benefits as permanent employees. For example, airlines may not offer health insurance, retirement plans, paid vacation, or sick leave, leaving contractors to arrange their own coverage and savings plans
• Inconsistent workload. The workload for contract pilots can vary significantly. Some contracts may be very demanding, requiring long flight hours. In the meantime, others may have little work for extended periods. This lack of consistency can make it difficult for pilots to maintain a stable income.
• Limitations of pilot career advancement. Since contractors are not permanent members of the team, they may have fewer opportunities for career advancement or promotions within the company. If long-term progression is important for you, this could be a significant downside.

2. Permanent employment for pilots

Permanent employment for pilots typically comes with an open-ended contract. There is no fixed end date, and the airline intends to hire the pilot for long-term operations. Pilots who meet specific requirements for experience, type ratings, and seniority receive a stable monthly salary, regardless of the number of hours flown. This provides a predictable and consistent income.

Pros of permanent employment for pilots

• Job security. The key advantage of permanent employment for a pilot is job security. Once hired, pilots can generally expect a stable income and ongoing employment. This is highly important for those pilots who already have or intend to have financial obligations, as well as those who need to take care of the family budget.
• Employee benefits. Pilots who aim to operate on a permanent contract basis usually receive various employee benefits, such as health insurance, retirement contributions, paid holidays, and sick leave. These benefits are important for financial planning and long-term health and security.
• Career development. Many permanent roles offer clear career progression. Pilots can move from First Officer to Captain. Depending on the airline, they may also have opportunities for additional training or advanced roles, such as training or management positions. This long-term career trajectory appeals to those seeking professional growth.
• Work-life balance. Permanent employees can also benefit from a more predictable flight schedule, which can help in maintaining a better work-life balance. Many airlines offer structured rosters, making it easier for a pilot to plan personal activities and time off.

Cons of permanent employment for pilots

• Less flexibility. Permanent employment generally means less flexibility. Pilots are usually required to work specific schedules, and taking time off might be more difficult compared to contractors who have more freedom to choose when and where they work.
• Lower pay. While permanent pilots enjoy job security and benefits, they may not earn as much as contract pilots. The salary is set and may not offer the same pay-per-hour rates that contractors receive. 
• Corporate politics. Working on a permanent contract means that pilots are often more involved in the company’s internal politics. This may include working with colleagues who are not necessarily on the same professional level or dealing with issues like seniority systems or union politics in some regions. 

3. Self-employment for pilots

Can a pilot work as a freelancer? Absolutely, yes! Self-employment contract for pilots means that the pilot works as a freelancer, where s/he can offer services to multiple operators rather than being tied to a single employer. These pilots may fly private jets, charter flights, cargo planes, or work on ad hoc assignments for airlines and corporate clients. Self-employed pilots have the flexibility to choose when and where they work. However, they are responsible for managing their flight schedules and securing contracts. 

Key advantages of self-employment for pilots

For pilots seeking greater autonomy in their work, self-employment offers an appealing option. If you are considering this type of employment, take a look at the key advantages and disadvantages it can bring: 

• Flexibility on flight schedules. Self-employed pilots have more control over their schedules than anyone else. They have the privilege of choosing when and where they want to fly. Freelancers can choose the number of contracts or hours they want to work, providing an opportunity to avoid burnout and maintain a pace that suits their lifestyle.
• Higher earning potential. Like pilots who work on a contract basis, freelance pilots can often negotiate higher pay per flight hour compared to a permanent salary. They also have the potential to take on multiple contracts simultaneously, which can increase their earnings. 
• Potential for starting a business. Self-employed pilots can grow their business by offering services like flight training or charter flights, giving them more freedom to be entrepreneurial.

Key disadvantages of self-employment for pilots 

• Income inconsistency. Self-employed pilots do not have a stable and guaranteed salary. Their income depends on the number of contracts they secure, which can be unpredictable, especially during off-season or economic downturns.
• Lack of social benefits. Freelance pilots are responsible for arranging their health insurance, retirement plans, and other benefits, which are typically provided to pilots on permanent contracts. Unlike permanent employees, they do not receive employer-sponsored benefits such as paid sick leave or vacation days.
• Lack of job security. Self-employed pilots faceless job security compared to those in permanent or contract roles. They may have periods of unemployment between securing contracts.
• Administrative challenges. As independent freelancers, pilots must manage their paperwork, taxes, insurance, and licensing. This administrative workload can be time-consuming and distracting from their flying responsibilities. Self-employed pilots are responsible for their marketing, securing contracts, and maintaining their reputation in the industry.

The decision between contract, permanent, or self-employment depends on individual priorities. There is no one-size-fits-all answer, and each pilot’s situation is unique. If your long-term goal is to climb the corporate ladder and secure a Captain’s seat in a major airline, a permanent position may be the best option. On the other hand, if you value variety and flexibility, contract work or self-employment might suit you better.

Want to learn more about why pilots get paid well or need tips on writing a pilot CV? Explore more articles on this blog today!