Should You Hire Full-Time or Part-Time Employees?

Definition of full-time vs. part-time employee

Generally, a full-time employee is one who works eight hours per day and 40 hours per week. However, there is some flexibility in this definition; the Internal Revenue Service (IRS), for example, considers a full-time employee one who works 30 hours per week or 130 hours per month. The Bureau of Labor Statistics (BLS) sets weekly work hours for a full-time employee at 35 hours.

Part-time employees work fewer hours than full-time employees, generally between 20 and 30 hours per week. They may work irregular shifts, as well, such as doubles or half-days. Part-time employees tend to be assigned schedules on a weekly or monthly basis, whereas a full-time employee’s schedule is less variable. 

“Deciding between part-time and full-time employees depends on the company’s needs and the nature of the role,” said Doug Arms, COO of TemPositions. “Part-time employees are great for roles where flexibility is key or when demand fluctuates, like in retail or hospitality. Full-time employees are better for roles that require a higher level of consistency and involvement.”

The flexibility of this definition may be due, in part, to a lack of federal guidance. According to the United States Department of Labor (DOL), “The Fair Labor Standards Act does not define full-time employment or part-time employment. This is a matter generally to be determined by the employer.”

What are the pros of hiring full-time employees?

Full-time employees offer businesses some key benefits, albeit at a higher impact to the payroll budget. These include: 

• Scheduling stability: When you hire full-time employees, you can generally expect them to be available every workday from 9 a.m. to 5 p.m. (or whatever your standard work hours are.) This makes it easier for managers to schedule employees and manage time off, since employee time and attendance is fairly predictable.
• Reduced turnover: Generally, full-time employees are more likely to feel a sense of commitment to the company. They are less likely to suddenly leave, especially if they are fairly compensated and offered career development opportunities. Full-time positions mean predictability in scheduling and pay for employees, too, so you can expect them to be more willing to stick around than a part-time employee.
• Deeper institutional knowledge: Full-time employees are able to dig into their roles in a way most part-time employees cannot. You can expect full-time employees to be adept not only in completing their own tasks but also understanding company goals and how to coordinate with other departments in a way that’s often unrealistic for part-time employees.
  
• Improved skill development: It’s easier to coach and train full-time employees who are always there compared with part-time employees who come in and out on a rotating basis. If you offer training and development programs, as well, full-time employees simply have more opportunity to engage with these benefits because they’re at work more often. 

“Having full time staff brings stability and commitment to the table while boosting productivity levels significantly. They typically show dedication to the company’s goals. They are a good fit for roles that need consistent participation,” said Jamie Wright, founder of The Wright Law Firm.

What are the cons of hiring full-time employees?

The advantages of hiring full-time employees do come at a cost, literally and figuratively. Here are some drawbacks to choosing full-time employees:

• Higher costs: Full-time employees usually cost more. Not only do they work more hours than part-time employees and therefore often have a higher salary associated (even if their equivalent hourly rate is less), but you may also extend benefits and perks to full-time employees. While this might not be as expensive as healthcare benefits if you’re running a small business with a handful of employees, it could still include things like training and development programs, equipment like company laptops, or paid time-off policies.
  
• Less flexibility: When you manage full-time employees, it’s harder to swap shifts or plug employees in during gaps in staffing. Most full-time employees work a consistent schedule and are already working the maximum number of hours they can without requiring overtime. For managers, this provides predictability, but it also means less flexibility and adaptability in how to set schedules.
  
• Costly to replace: While full-time employees are less likely to leave suddenly than part-time employees, they do still move on — and when they do, they’re more costly to replace. Expect to pay anywhere from 50 percent to 200 percent of a full-time employee’s salary when replacing them. Those costs can add up quickly.

“Hiring [full-time employees] comes with added expenses like salaries and benefits along with paid time off. Moreover if business requirements shift, managing full-time employees during transitions can be complex, without having to consider downsizing or layoffs,” Wright said.

What are the pros of hiring part-time employees?

More time on the clock doesn’t always equal more efficiency. Hiring part-time employees has distinct advantages, including the following:

• Cost-effective: It’s typically less expensive to pay for fewer work hours, and a lean but efficient workforce is essential for businesses living close to the balance sheet. While hiring workers for less time may seem inefficient, that’s not always the case. Many studies indicate that workers spend a lot of time not working while getting paid at work. If you set measurable business goals for part-time employees, you may be surprised what one efficient part-timer can accomplish.
• Specialization: Another significant advantage to hiring a part-time employee is that it may help you get a higher-caliber professional than your small business could afford at full-time hours. For example, if you can only afford to spend $35,000 a year on a salary when hiring a social media manager and want a full-timer, you’ll have to hire someone with minimal experience. However, if you take that same $35,000 and use it to hire someone highly experienced for part-time hours, they may accomplish more in 10 or 15 hours a week than a recent college graduate can in 40 hours or more.
• Scheduling flexibility: If your business is seasonal, part-time employees allow you to maintain cash flow during slow times and ramp up when demand increases.

“Part time workers provide flexibility and cost advantages for companies with varying workloads or seasonal needs,” Wright said. “They help cut down on labor expenses, as they typically don’t receive benefits such as health insurance or paid time off. Nevertheless, they might lead to increased turnover rates and may not fully blend into the company’s culture or long-range objectives, potentially affecting team unity and stability.

What are the cons of hiring part-time employees?

On the other hand, part-time employees create some challenges:

• Limited availability: Part-time employees are not available to you 40 hours per week, they may or may not receive benefits from you, and they may have other clients paying them. If you have a big project that requires all hands on deck or a sudden uptick in demand, you may not be able to count on these part-time employees to give you more hours or go above and beyond.
• Higher turnover: Some employers feel that part-time workers are more likely to jump ship if the waters get rough. They are viewed as less dependent on income than full-time workers whose salaries (and often health insurance and retirement accounts) are tied to their jobs. However, many companies mitigate this issue by offering benefits to part-time employees, although this increases costs.
• Scheduling gaps: Additionally, creating employee work schedules for part-timers on their own or alongside full-time employees can be a logistical hurdle for businesses that aren’t adept at flexible scheduling. Human resources departments may be reluctant to add a new worker classification to their management routines, and managers may struggle to adapt to employees who aren’t available all day.

“It often makes sense to have a mix of both part-time and full-time employees,” Arms said. “The decision should be based on the workload and the stability of demand for the role. For consistent, ongoing work that requires a deeper commitment, full-time is the way to go. Part-time can be a great solution when there’s a need for more flexibility or when the workload fluctuates seasonally. A combination allows for adaptability without overcommitting resources.”

What is job sharing?

Job sharing is a work arrangement that splits one full-time job into two part-time jobs. Job sharing can be advantageous for small businesses in early growth stages or companies with trouble attracting excellent full-time employees. Many highly skilled professionals are only available for part-time hours, including the following: 

• Parents
• People with disabilities
• People seeking greater work-life balance 
• People pursuing other goals, such as higher education or starting a business

According to the DOL, job sharing can boost morale and productivity while attracting high-caliber new employees and retaining your current team. However, both workers in the job-share arrangement must have the skills and work ethic to get the job done as efficiently as one person. 

Another benefit of job sharing is that if one employee (or one-half of the job) doesn’t work out, gets sick or leaves for a better offer, the job is not entirely unstaffed.

Part-time vs. full-time employees: Which is better for my business?

Whether it’s best to hire a full-time or part-time employee depends on your business. If you’re unsure how many hours per week a job takes to complete, you might be better off starting with temporary or part-time staff because they work fewer hours and cost less money. Once you have an idea of the output for the part-time positions in your company, it should be easier to gauge whether you genuinely need someone for 40 hours or more per week.

Many business owners assume that hiring full-time positions means paying for costly benefits like health insurance, but that’s only true for businesses that employ 50 or more people. If your business is smaller than that, you have no legal obligation to provide health insurance to any of your employees, regardless of their work hours.

Jennifer Dublino and Tejas Vemparala contributed to this article.