Being an Employee vs. An Independent Contractor

Everyone knows times are hard. Unemployment is through the roof. People are losing their homes. So when it comes to the job market, any advantage you can get is an advantage you take. A question that is being asked more and more frequently is: “Should I be an employee or an independent contractor?” For those of you who don’t know the difference, an employee is a person who works for someone, and an independent contractor is, more or less, self-employed. Below are the advantages and disadvantages of being an employee versus an independent contractor.

Employee: Advantages

As much as being an employee doesn’t feel advantageous, there are some advantages. The first and foremost advantage is security. Being an employee means receiving a steady paycheck. As long as remain working for that company, every week a check will be mailed to your house. This is a stark contrast to being an independent contractor. Second, you may get benefits, such as dental insurance, medical insurance, and/or retirement options.

Employee: Disadvantages

There are two sides to every coin. First, you do not set your own hours. You are required to be at work whenever your employer designates. Second, you have no control over what you do. You are being paid to do one thing: follow orders. Failure to show up on time or follow orders usually results in the loss of your job.

Independent Contractor: Advantages

Your biggest advantage as an independent contractor is that you set your own hours. You can decide to have a two-hour lunch break, or to work through your lunch break. Also, you have a greater potential to make money. As an independent contractor, you can charge the prices you want and work as much as you want. Being your own boss can be great.

Independent Contractor: Disadvantages

Independent contractors are, by definition, independent. There is no union to represent you or worker’s compensation if you get hurt. Furthermore, being an independent contractor usually requires an initial investment. You can’t be a plumber without first purchasing the right tools. As an employee, what you need to complete your task is given to you. Also, you owe more in taxes and have to file a 1099, which sometimes includes the confusing process of making estimated tax payments over the year. A 1099 is much more complicated than a 1040.

What Does It All Mean?

Employers are looking to hire more independent contractors because it is cheaper for them. They don’t have to go through the headaches of paying Social Security and Medicare, or offering benefits to lure the best employees. While this may be the case, if independent contractors can’t find work, they can’t work. Sometimes that risk is too great for a person to take. In the end, it is a matter of circumstance that makes one option more convenient than the other.

Kathleen Hubert is a blogger who writes on a variety of different sites. Check out more of her work at

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