Perm Desk Versus Contract Desk: How the Two Businesses Actually Differ

A perm desk sells an event and a contract desk sells an annuity. That single difference cascades into cash flow, recruiter behaviour, client relationships, capacity planning and how each should be measured. Firms that manage both with one set of targets and one operating rhythm consistently find that one half quietly subsidises the other, usually without anyone identifying which.

Last reviewed August 2026. Delivery observations from Sortinghat customer base, stated as directional.

Cash flow, and why it constrains growth differently

A perm placement bills on start and collects on terms. Growth is limited by delivery capacity.

A contract placement bills weekly or monthly while you pay the worker on a shorter cycle than the client pays you. Growth is limited by working capital, which is a completely different constraint. A contract desk growing quickly consumes cash even while it is profitable, and firms that do not model this run out of money during their best quarter.

That is also why back office quality matters more on contract, as covered in where back office margin leaks. A delayed timesheet is a delayed invoice, and on contract that compounds weekly.

What recruiters actually do differently

Perm. Fewer candidates, more depth each. The work is assessment, selling and managing a long client process to an offer. A perm recruiter carrying too many roles delivers none properly.

Contract. More candidates, faster cycles, higher tolerance for availability-driven decisions. Speed matters disproportionately because contract requirements are usually urgent and the first credible submission frequently wins.

Putting a perm recruiter on a contract desk usually produces careful, slow, lost roles. The reverse produces fast, shallow submissions and client complaints. Both are common and both are management failures rather than individual ones.

Client relationships behave differently

A perm client reappears when they have a vacancy, which may be months apart. The relationship is episodic and needs maintaining across gaps.

A contract client is in continuous contact because assignments end, extend and get replaced. That produces more touchpoints, more opportunity to expand, and more exposure when service slips. Contract clients churn faster and grow faster.

It also means contract accounts carry concentration risk more visibly, which matters for how a firm is eventually valued.

Redeployment, the number most firms do not track

The cheapest placement on a contract desk is the contractor you already have, moved to a new assignment as the current one ends.

No sourcing cost, no compliance rework, and a worker who already knows you. Yet most firms discover an assignment is ending when it ends, by which point the contractor has usually taken something else.

The fix is a trigger rather than a report: workers surface in a redeployment segment at thirty, sixty and ninety days before end date, with availability confirmed by outbound rather than by somebody remembering. Same mechanism as temp desk redeployment.

How to run both without one starving

Separate targets and separate metrics. A single revenue target across both pushes recruiters towards whichever pays faster in the current month, which is usually perm, and the contract book quietly stops being fed.

Do not share recruiters across both by default. The activity profiles are different enough that most people are meaningfully better at one.

Report margin separately. Perm gross margin and contract spread are different numbers and averaging them hides which desk is actually working.

Fund contract growth explicitly. Treat working capital as a planned input rather than a surprise.

Frequently asked questions

The two numbers to separate this month

Split last quarter's gross profit into perm and contract, and calculate the margin on each independently. Most firms have never done this and find one desk is carrying the other.

Then check your redeployment rate on assignments that ended in the same period. If nobody can produce that number, the cheapest revenue available to you is going to a competitor by default.