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Full Time Employment Vs. Contract Work

I've thought about this issue before and these are the advantages/disadvantages that I could come up with. 





Full Time Employment


  • Full benefits like health care, life/disability insurance, rrsp contribution matching.
  • Steady dependable work where there's no need to find another project when one is about to be finished.  The company will typically re assign you to wherever is needed.


  • Higher taxation as employees have limited tax deductions besides RRSP's.
  • Might get hired for one project, but the company puts you on another that you may not be as interested in.
  • Lower per hour rate compared to contract work.

Contract Work


  • Higher per hour wages.
  • Flexibility of going from one job to another.
  • Get to claim tax deductions.  For example, if you work from home, you can claim your office/car expenses thus reducing your income taxes payable.


  • Variable benefits – depends on your contract
  • Contracts can be terminated early thus resulting in unpredictable income.
  • The need to constantly stay on top of your game as companies are hiring you for a specific skill set.

When it comes down to it, contract work and full time employment are two totally different beasts.  Contract work is more entrepreneurial, thus introducing more risk but with potential of higher returns.  Full time work on the other hand, is more steady, but with lower pay.  It's kinda like choosing between going variable or fixed on your mortgage. 



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