Contracting is lose-lose. Companies have economy of scale. If you're a developer, you lose out having to play games with negotiations and juggling cashflows for

Contracting is lose-lose. Companies have economy of scale. If you're a developer, you lose out having to play games with negotiations and juggling cashflows for late payments. If you are an employer, a contractor costs more and is less reliable. But in practice, it works out because markets are inefficient. Say, you have a block of work that is valued at $100k. You can hire a person for $150k/year and hope you get more blocks of work worth $300k or whatever later. Or you can budget around $60k to get this work done in 2 months. The contract option is easier to manage. A full time job is basically a bulk discount. You are guaranteed money even if there is no extra work, and you don't have to juggle bills. I think companies like Toptal do a really good job of playing into this arbitrage.