Interim or permanent: which is more expensive, at the end of the day?

Cost is often given as a reason why organisations don’t use interim managers. In reality, the difference between the true cost of a productive day for a permanent employee and an interim’s day rate can be slim, and the gap narrows further when you consider the benefits and flexibility an interim brings.

Let us illustrate that with some numbers. The details clearly differ between organisations, public sector or otherwise, but an example of a Project Manager in the public sector helps illustrate the point. Bear with us…



around £550 per day
National Insurance (12.8%)
Pension (19.5% - Source: IEA)
Health cover  
Other benefits
HR, payroll, management, support (typically 20% of salary)

We should look at how many days you actually get for your buck: allowing a potential 253 working days per year, the cost for a permanent Project Manager hits £291 per day. You then have to allow for 30 days’ holiday, for maternity, paternity and compassionate leave, an average 8.5 days’ sickness (Source: CBI), plus 10 days’ training, not to mention time taken on general administration. The final tally of productive days for a permanent employee? 182 days, which means a cost of around £400 per day.

The fact is, interim and contract managers are only paid for when they work and are only on your team for as long as you need them. Crucially, there are no upfront recruitment fees, restructuring costs and costs associated with end-of-role redundancies, nor do interims accrue benefits. Then, of course, there are the many non-financial benefits: interims have all the skills and experience you need and have ‘done it before’, often in relevant previous roles. Their objectivity and independence typically add a great deal of value, especially if internal politics are prominent. They have a vested interest in performing and delivering: their route to the next assignment is success in the current one. And no career or re-deployment considerations are required if business plans change and people are no longer needed.

An interim from Independent People adds value by bringing experience, a pragmatic delivery orientated approach – helping you achieve measurable outcomes. To quote the Interim Management Association (IMA): 'In the past clients used a management consultancy to undertake work but today tasks are successfully delivered, and at significantly cheaper daily rates, by retaining interim managers.'

The diversity of positions assumed by interims reflects the challenges that clients call on providers like Independent People to address. As client needs have evolved, so have the types of skills that interim professionals bring to the market. Clients repeatedly remark on the scale and variety of challenges they are facing. Their imperative is to lead and achieve substantial business change, and they look to interim resources in many instances to provide positive support to a range of different business areas.