I have worked for various different companies where they pay developers up to 3 times less than contractor developers and in some cases I have seen companies have more contractors to developers for long periods of time. I understand contractors are useful but they are not worth 3 times more.
Contractors have to pay all of that from their turnover - along with professional indemnity insurance, public liability insurance, accountancy fees etc.
And note I said turnover. There seems to be this misconception that all contractor payments go straight into the contractor's pockets. They don't, they are business receipts that go into a company. That company then pays the contractor.
What contractors do get is the ability to shift things around as they see fit. Employees are stuck with whatever structure of payments to make up "the package" is decided by the higher ups.
