You might be surprised at the amount of money they save by not having you as an employee. They save a few thousand a year on your desk; thousands on unemployme

You might be surprised at the amount of money they save by not having you as an employee. They save a few thousand a year on your desk; thousands on unemployment taxes in many states; SS and income tax contributions; healthcare benefits, stock awards, and bonus schemes; etc. Regardless, it's not necessarily intended to be a pure cost-cutting scheme: switching you to being a contractor essentially improves their liquidity. It's a little like someone with lots of cash getting a mortgage to buy a house: they could afford it, but they'd rather pay a little more over time to get additional flexibility.