Contractors are usually double what you would pay a salary person in the US too. It is because contractors have less reliable work and pay more taxes than salaried employees.
>Contractors are usually double what you would pay a salary person in the US too. It is because contractors have less reliable work and pay more taxes than salaried employees.
an employer might pay double for a contractor, but the vast majority of contractors go through middlemen who take a big cut. In my experience, this means that I (the contractor) end up getting about 30% more than I would have gotten as an employee (after equalizing for taxes and benefits.)
I have been able to get independent jobs as a "contractor" where a middleman wasn't involved, but in my experience? those jobs almost always require more work/responsibility for less pay.
Yes, I know, this means I haven't found the right kind of client. I'm just relaying my own experiences. In my own experience, high-paying contract jobs through an agency are really easy to get, but only undesirable clients are willing to go direct with me.
I've spent some time on it... and, for example, have (or have had, at various times) all the required insurance; but there's something else I'm missing.
In the UK, taxes are generally better for self employed people when trading through a personal service company, because you can control the flow of dividend payouts.
Contractors (on a 6-12 month contract) actually do get paid better significantly than permanent employee counterparts.
I find that it's similar in the US. Contractors do pay a tax that's paid by an employer (half of the Social Security and Medicare Tax, about 7.5%), but they can also claim more deductions.
With long term contracts that provide reliable work, contracting pays well. But without benefits.
Right. But who cares about the benefits when the difference is $4-6k per month? Most of those benefits (tech books and conferences, laptop, smartphones, software, etc) are valid tax deductions for software developers. I'll happily pay for those.
The UK, and many other EU countries, also have excellent ‘free’ healthcare.
In the U.S. it's a bit different because the category "benefits" often includes things that in other countries are part of the social system, such as health insurance, childcare, maternity/paternity leave, continuing education, etc.
That can all admittedly be solved with money, given enough of a pay difference, though in some cases it would have to be a quite large pay difference. The stickiest part used to be the health-insurance part, which was hard to buy outside an employee risk pool if you had preexisting medical issues, but that's mostly been fixed (or at least papered over for now).
The benefits often include things like stock schemes, pension payments, life insurance policies and so on. It does add up.
I won't argue that contractors will probably take home more even taking benefits into account, and the tradeoff is then between more stable employment and a bigger paycheque.
The benefits that companies provide to salaried employees (healthcare, etc.) end up being more than 40% of the pay they actually see anyways. So in the end, the pay is comparable.
You get what people think you will take; agents don't bother offering me low-paid jobs because they know I won't take them and they save the big rates for me.
It seems in the United States salaries for permanent employees are higher, but that contractors don't get paid double.