Every few months, I have a con­ver­sa­tion with some­one who argues that work­ing as an employ­ee is more secure than a con­trac­tor. I disagree.

The idea that work­ing as an employ­ee offers any job secu­ri­ty is an old par­a­digm. In the 1950s and 1960s, com­pa­nies took care of employ­ees and it was­n’t unusu­al for peo­ple to work for one orga­ni­za­tion for decades. These days, it feels like com­pa­nies fre­quent­ly restruc­ture, declare bank­rupt­cy, and hire and fire employ­ees on a whim. I fig­ure that if you man­age to eke out a job as an employ­ee at one com­pa­ny  for three years in today’s econ­o­my, you’ve done well (espe­cial­ly in high-tech).

I recent­ly worked with a woman who was ter­ri­fied of los­ing her job. She asked me about work­ing as a con­trac­tor. I explained some of the ben­e­fits but also the risks—namely, my job can be ter­mi­nat­ed with almost no notice and with­out sev­er­ance. She could­n’t com­pre­hend why I would choose work­ing as a con­trac­tor. She craved secu­ri­ty in a world that no longer offers any guar­an­tees to any work­er. After my con­tract fin­ished in the fall, the com­pa­ny’s man­age­ment prompt­ly declared they need­ed to cut costs. As an employ­ee, her posi­tion was elim­i­nat­ed and she was jet­ti­soned. So much for job security.

For the record, here are some of the rea­sons I contract:

• Vari­ety of work: In Cana­da, con­tract work­ers typ­i­cal­ly work on a large project for six months to one year. That means I am exposed to a lot of inter­est­ing projects in a com­pressed peri­od. I’ve doc­u­ment­ed Share­Point imple­men­ta­tions, soft­ware roll-outs, and indus­tri­al equip­ment in one year. I believe that being exposed to dif­fer­ent projects, peo­ple, and tech­nolo­gies has made me a bet­ter writer. As a con­trac­tor, it’s sink or swim.
• The adren­a­line rush. It’s stress­ful when you know your con­tract is com­ing to a close in four weeks and you have don’t have anoth­er lead. It’s also stress­ful when your client decides that it needs to cut costs and your ser­vices are no longer need­ed. But with that stress comes excite­ment. I’ve worked on con­tract for more than four years and have been work­ing con­sis­tent­ly, except for the occa­sion­al two- to three-week break.
• High­er income. I don’t receive paid vaca­tion, health and den­tal ben­e­fits, or sev­er­ance pack­ages. Clients rec­og­nize this so are will­ing to pay more for my ser­vices. If you man­age your mon­ey well, you can cre­ate your own sev­er­ance pack­age (essen­tial­ly a finan­cial cush­ion if you are between con­tracts) and put aside mon­ey for your retire­ment. In Cana­da, health and den­tal ben­e­fits are sur­pris­ing­ly afford­able: I pur­chased a pri­vate health plan that cov­ered my fam­i­ly for about $150 per month—hardly cost pro­hib­i­tive. One caveat: I know that health plans in the U.S. are much more expensive.
• Pre­ferred tax rates. As the own­er of an incor­po­rat­ed busi­ness in Cana­da, I pay the small busi­ness tax rate of 13.5 per­cent on earn­ings. That means if I earn $100,000, I could pay $13,500 in tax. But in real­i­ty, small busi­ness own­ers can also write off their car costs, a por­tion of their mort­gage, books and mag­a­zines, lunch­es and din­ners that are relat­ed to work, health plan costs, and much more. So in real­i­ty, the tax rate I pay is less than 13.5 per­cent. In con­trast, a Cana­di­an employ­ee can pay up to 38 per­cent in tax for the same $100,000.

On a relat­ed note, a report by Intu­it argues that full-time oppor­tu­ni­ties may be hard­er to find in the future as com­pa­nies rely more on “con­tin­gent work­ers.” Here’s an excerpt from the report: “Today, rough­ly 25–30 per­cent of the U.S. work­force is con­tin­gent, and more than 80 per­cent of large cor­po­ra­tions plan to sub­stan­tial­ly increase their use of a flex­i­ble work­force in com­ing years…In the U.S. alone, con­tin­gent work­ers will exceed 40 per­cent of the work­force by 2020.”

Con­tract­ing, though, is not for every­one. You need to net­work with oth­ers, pro­mote your­self, nego­ti­ate with clients, invoice, remit tax­es to the gov­ern­ment, and jug­gle the needs of mul­ti­ple clients. Con­trac­tors fre­quent­ly com­plain of anx­i­ety and fatigue.

Will I ever enter­tain work­ing as an employ­ee again? Yes, of course. But if I do work as an employ­ee again, it won’t be because of the promise of job security.