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Comment by tomp | Hacker News Reader

> If he's that competent, he could hire/mentor juniors and just use his skills to run a contracting business and keep making big bucks while not having to lie all the time?

Much much easier said than done.

99% of companies that want to hire employees won't hire a contractor/consultant instead for that job.

How do I know? 15 years experience, top candidate in many interviews, great salary / employment. Yet every time I've tried to get a consulting arrangement set up it's been extremely hard and ultimately unprofitable (i.e. pays significantly less than full-time job, on average).

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I think this is a US specific thing.

I work as a contractors with all my clients (who know of each others) and they all pay significantly more per hour compared to an employee. As an employee I could expect to make 1/4 of what I actually make.

The only exception in this arrangement was when I worked with an US company, they wanted to hire me as an employee and paid 1k per month to some company in my country just to hire me. An insane waste of money, not to mention taxes on my side.

US tech salaries are so much higher [at tech companies] that it closes much of the gap on how much more you could earn in a consulting arrangement.

Yes: US salary costs include having to pay healthcare fees (it’s not universal here), so work contracted prices are generally discounted by that amount relative to salaries.

In the US it's not uncommon to have a $200k base. Not even taking into account stock compensation and benefits, you'd need to command about $400/hr contracting to fit your 4x figure. Does that sound comparable to your setup?

I don't know about the person you're asking, but I have known many people (both programmers and consultants in other areas like marketing, game design, etc.) who billed at more than that hourly rate, here in Europe (where salaries don't commonly go above $200k).

I seriously doubt this. What's your rate and average post-tax take-home over the past few years?

> How do I know? 15 years experience, top candidate in many interviews, great salary / employment. Yet every time I've tried to get a consulting arrangement set up it's been extremely hard and ultimately unprofitable (i.e. pays significantly less than full-time job, on average).

Sounds like a legit negotiation strategy:

- You prefer a consulting arrangement over being hired.

- The company prefers to pay less for the job.

So both involved sides get a part of the pie that is negotiated about, and has to compromise on another aspect.

You say this like you can just talk with the VP and CFO and have a nuts and bolts conversation about big systems things as an pre-hire IC. You can't negotiate with even medium-sized companies at that level. They have a fixed idea of what the 'role' looks like, and almost always it's full-time, long-term. You can negotiate maybe 10-25% salary increase, but that's it. Good luck even getting more PTO (the "standard" amount is always "generous" and if you got more it would complicate "team dynamics").

I wanted to explain from a purely economic perspective why if you want a consulting role instead of a full-time job, you will likely be paid much less.

Consulting often pays way more than salaries every do.

In the same way that driving Uber pays more than driving for a taxi company: Not as much when you factor in your own expenses (taxes, insurance, etc) and non-billable work.

Uber doesn't pay more than a job as a taxi driver as far as I know (take home).

The take home pay after carrying more expenses probably makes it worse.

Uber sells demand for transport. They don't own the transport and the burden of owning, and maintaining the transport is pushed on to freelancers, who have less certainty of income than they would as employees might.

Theres been lots written about the insecurity to employment that is created by more things offering gig jobs on one hand but not always ending up also offering part time or full time positions.

From the customers side, apps like Uber provide a sense of certainty (visual map) that existing industries haven't been willing to invest the same kind of capital into and those apps as a result are not comparable or inviting.

Companies don't want contractors because they're perceived as (and often are) unreliable. Lower pay won't fix that, and a good hiring manager won't let someone weasel their way through that with this kind of prestidigitation.

Contractors like CEOs send clear signals they refuse self exploitation and are willing to exploit others .

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