There was a time where the norm was to graduate from college, get a job and stick to it till retirement. Recently, however, with the new demand economy, graduating with a skill set and working as a contractor, moving from one contract to the other is considered much more satisfying.
Hawaii is considered a resort community, thus, there are limited white-collar jobs for a person to choose from, and working as a blue-collar skilled employee is much more common. The question of whether to work as an independent contractor or as an employee is often one that many workers ask themselves.
This article will attempt to explain the pros and cons of being an independent contractor to help you determine whether or not it is the right career path for you.
Who is a Contractor?
Before going into the pros and cons of being a contractor, the first question to ask is “who is a contractor?” A contractor is a person who is responsible for providing skills and completing tasks that are required to achieve the success of a project. In some cases, a contractor may need to employ subcontractors to carry out tasks for which they cannot carry out on their own.
A general contractor in Hawaii may earn up to about $29 per hour which is much higher than contractors in other parts of the country.
Pros
Being an independent contractor means that you will be your own boss. This means that you will work shoulder-to-shoulder with managers, bosses, and other employees of a company you work with but rather than supervising your work, they will be referred to as your clients. This gives you creative freedom over the work you deliver, although your clients may require a certain standard of result from you.
In addition, you will make much more money as a contractor than as an employee. You will negotiate your prices directly with your clients and companies are willing to pay more for an independent contractor since they would not have to enter long-term commitments, pay social security taxes, Medicare taxes, or other health benefits.
Cons
One of the downsides to being a contractor is that contractors are required to pay all of their own federal, state, and local taxes. Contractors must also fund their retirement accounts, health, and liability insurance rates and are not qualified for unemployment benefits.
In addition, contractors are expected to provide the tools and equipment to be used for the jobs. Clients can get penalized for providing tools or equipment to independent contractors by enforcing agencies as this misclassified contractors as employees.
Clients are also not expected to reimburse contractors for unexpected expenses, thus, as an independent contractor; you must foresee all necessary expenses and include them when determining your rates.
Conclusion
If you are creative and adventurous, then being a contractor is likely a good career path for you because it provides you with creative independence and allows you to be your boss. There are, however, pros and cons of being a contractor, and it is very important to understand all the rules before attempting to go into the field.