A recruiter dangles “$900 a day” and your current salary suddenly feels small. But a day rate and a salary aren’t the same currency — and comparing the headlines is how contractors end up effectively worse off.
What the day rate has to cover
A permanent salary quietly includes a lot that a day rate doesn’t. Strip these out before you compare:
- Superannuation — 12% you’d get on top as an employee; as a contractor it comes out of the rate.
- Leave — annual and sick leave you’re not paid for. You only earn on days you actually bill.
- Downtime — the gaps between contracts. Few contractors bill all 52 weeks.
- No safety net — no notice period, no paid public holidays, your own insurance and admin.
A rough rule of thumb
Once you account for billable days (often ~220 a year, not 260), add super and a buffer for risk and downtime, a day rate needs to be meaningfully higher than the daily slice of a salary just to break even. The headline gap is usually smaller than it looks.
Compare them properly in seconds
Don’t do this maths on a napkin. The SalariQ rate converter turns a salary into a balanced day rate and back — super, leave, downtime and buffer worked out for the Australian market — so you can see the real like-for-like number before you decide.
Contracting can pay more — but only once the rate covers what a salary quietly gave you for free.
