Can you earn more money working on a contract than working in a fulltime job?

Having spent several years specifically working as an IT recruiter filling Information Technology positions, I certainly saw my fair share of highly paid contractors.

In most instances, contractors earned more money on an hourly basis than they would have earned had they been doing the same job in a fulltime capacity being paid a salary.

The reason contractors tend to be paid more?

With a contract job, you are typically signed to do the job for a specific length of time so accepting the contract means you're taking yourself off the market for a fulltime position for the length of the contract. In my experience as an IT recruiter, contracts generally ran for 3, 6, or 12 months in length and could sometimes be extended, often several times.

Also, with a contract position you generally don't get paid any benefits, don't get paid for vacation and might not be eligible for other perks that fulltime staff might otherwise be entitled to.

Sometimes a contract job turned into a fulltime position later on.

With contract work, I often found that once people tasted the (higher) contract money, they didn't want to work as a fulltime employee anymore.

Also, many of them liked the variety of work and the fact that they were exposed to different work environments, technologies, etc.

The flipside of course is that contractors might end up finding themselves out of work for periods of time if one contract finishes and they haven't found a new contract to go to.

Then again, perhaps they could afford to take time off given the money they were earning.

If you're considering contract work you should be aware that some employers have difficulty hiring people for fulltime positions who have a track record of working contract.

They often fear that if a contractor accepts their fulltime position, they will end up quitting the fulltime job the moment a more desirable (ie. better paying) contract position arises.

If you're looking at a specific contract job, you might consider why the job is being offered as a contract.

Does the company simply require someone for a set period of time and are willing to pay extra for this person (ie. the position is a "typical" contract) or are they simply trying to avoid adding a fulltime employee (ie. extra headcount) which might mean they'll simply offer you the fulltime equivalent salary for the period you would be working with no premium paid?

I once experienced the latter situation and can tell you that I was simply paid the fulltime equivalent since there was a fulltime hiring freeze in the company and my manager got around it by classifying my job as "contract."

In this instance, I certainly didn't paid get the higher "contractor" rate, that's for sure!

The good news was that after working on contract for about 9 months, I was hired as a fulltime employee so things turned out quite well for me.