I've been on both sides. Depends on the company, of course, but all else being equal: - Contractors don't always get the best projects. Often the coolest, most

I've been on both sides. Depends on the company, of course, but all else being equal: - Contractors don't always get the best projects. Often the coolest, most strategic projects go to employees. Of course, if no one internally is qualified, contractors then get the best projects. - When cuts happen, contractors are at the front of the line, and when cuts need to go deeper, employees then are at risk. - It is a pain to collect. You are often not the primary contractors, there is usually a pass-thru company that is well-connected and gets the receivables and then pass them onto you. Sometimes they delay payments 45 days. Sometimes 60 days. I've had some months paid 4 months late. On rare occasions you never get paid. - You pay the employer payroll tax if you are in the US and on 1099 (on W2 you only pay half the payroll tax). - Benefits you purchase are often not the best benefits. The benefits you would get at a large company are often well negotiated and much better and much cheaper than what you purchase a la carte. Obviously for a contractor premium high enough, none of the above really matters. But contract work isnt worth it, for say, a 40% premium IMHO, especially with a family. At higher premiums (250%, 300%) it can make sense assuming you like what you will be doing.