Is W-2 employment inhibiting the growth of the American People?

[Vilgan]

One thing that always bothered me about w-2 employment was how patronizing a lot of it seemed to be. Taxes are taken out before you see them. 401k fund options are made for you. The employer decides how much time off you get. Income is dolloped out at a steady rate irregardless of how your business is doing or how hard you personally are working and the process to correct that is fairly slow and frequently involves changing employers. The employer decides what benefits to offer and typically has very little flexibility in how to modify them. 12 weeks paid maternal/paternal leave might be a great benefit for some but why is it subsidized by everyone? Why can't a non parent take 12 weeks "I really want to hike around Europe" leave?

I always found a lot of that constraining and it felt like a welfare state. You never need to learn to manage finances because your $$ comes at you at a nice steady rate. Why not spend it all when 2 weeks later another allotment of cash will arrive? The sheep are pushed into their pens open desk arrangements and the employer hopes that productivity results rather than just paying purely for productivity. Firing bad employees, especially if they might be a protected class, is scary so most employers don't bother. The most important part of determining income happens before both sides even really know each other.

Aren't we discouraging financial education and blatantly increasing consumerism with w-2 employees? If income wasn't steady, people would need to learn how to budget and might think a lot harder before making an expensive commitment. By paying for productivity, people could be productive to earn $$ and then do what they want when they don't instead of looking at cat videos waiting for the clock to tell them to go home.

Management could focus on organizing productivity to maximize it rather than other less productive things.

Is feeling constrained and bothered by having others making so many choices for you really that unusual? I feel so much happier and free now that I make these choices myself and feel a lot of why people hate their jobs and long for FIRE is because they've put power over their work happiness into the hands of others. Obviously, not all jobs can be freelanced like teachers, but for those who can - why continue working for 'the man' instead of becoming your own boss?

[NICE!]

12 weeks paid maternal/paternal leave might be a great benefit for some but why is it subsidized by everyone? Why can't a non parent take 12 weeks "I really want to hike around Europe" leave?

Bingo. Thanks for saying this, I always feel alone in my thoughts on this. The same goes for the tax benefits you get for having children.

[Left]

you are treating the 12 weeks like a vacation.... it isn't really. not that people won't try to abuse it. and it isn't paid by law, it is up to the company.

I rather be w2 than 1099 more times than not. look at how Uber is acting about their drivers

[arebelspy]

The employer decides what benefits to offer and typically has very little flexibility in how to modify them.

Huh?  This is the opposite of the case, IMO.

Employers can decide what benefits they offer, and due to that, they can offer benefits that are really flexible.  They can offer weeks and weeks of paid vacation. They can offer work from home. They can offer 4 day weeks. They can offer paid sabbaticals.

They DON'T, because it's not profitable to them, and * you, that's why.

But as we've seen from the FIRE community, once you're valuable enough, and have F U money, it's all negotiable. We have people who have negotiated part time.

Look at RoG's wife:
http://rootofgood.com/first-attempt-early-retirement/

Reduced hours, work from home, more pay, and paid sabbatical?  That's * incredible.

I don't know how you can say that employers have "little flexibility in how to modify" the benefits they offer.  It's all completely flexible.

12 weeks paid maternal/paternal leave might be a great benefit for some but why is it subsidized by everyone?

Since the first two comments were about this, let me clarify before this gets too off track: no one is subsidizing this.  In other countries, perhaps.  The U.S. does NOT have paid maternity, by law.  They have "you can take 12 weeks (unpaid) without being fired".  Want longer?  Too bad, job can say no.

Some jobs might make it paid, but that would be a benefit they offer, and not "subsidized by everyone."

Your throwing this comment out there about maternity (aside from it being wrong twice, it's not always paid, and it's not subsidized by everyone) will detract from your main post, I fear.

Hopefully this clarification will satisfy everyone, and we can move on to discuss the main point of your post, but knowing the Internet, probably not. :P

[LiveLean]

Being a W-2 teaches you to be dependent on an employer and a two-week paycheck for life. And when that paycheck disappears through layoff, firing, career being obsolete, etc., you have no skills to deal with it since you're so dependent on W-2, you will do anything to get another W-2 gig, even if this means uprooting your family and moving somewhere undesirable.

So many of my W-2 friends have a sense of entitlement. They can't imagine having to buy their own laptops, cell phones, health/life insurance. They're accustomed to employers paying. And these are just the corporate drones, let alone the government employee types. Rich Dad/Poor Dad is a clown on some levels, but one brilliant thing he said is most people go from depending on their parents to depending on an employer to depending on the government. (Some just combine the last two steps and go to work for the government.)

I went freelance/1099 in 1998 in my late 20s. And while there have been highs and lows, not having an employer control 100 percent of my time/life and dictate when and how much time I can take off -- and how much money I make -- has made all the difference. I can't sleepwalk through even one day of work since there's not the automatic W-2 paycheck coming. On the flip side, I can take any day off at a moment's notice. I equate money with freedom, not how much consumer crap I can buy.

Is W-2 employment inhibiting the growth of the American people? Damn right it is. I'm guessing the MMM community has a far lower percentage of W-2 people than American society in general.

[mr_orange]

One of the great tragedies of our country is that people don't learn to run their own small business and spend all of their effort slaving for a W2.  Most of the very wealthy people in our country got there by running their own small business.  Immigrants dominate the business ownership percentages because they realize what a true gift it is to be able to make it for yourself. 

[matchewed]

I don't see the connection between financial education and w2 employment. Can you clarify that one? Don't all people have to manage their finances regardless of the regularity of the paycheck? Admittedly some people will be more skilled at it than others but I'm not sure if the w2 has much, if anything, to do with it.

Also what model would replace steady employment that satisfies both employers and employees? You keep mentioning maximizing productivity. It sounds a bit buzzwordy to just drop that and act as if it satisfies everyone.

[2lazy2retire]

Being a W-2 teaches you to be dependent on an employer and a two-week paycheck for life. And when that paycheck disappears through layoff, firing, career being obsolete, etc., you have no skills to deal with it since you're so dependent on W-2, you will do anything to get another W-2 gig, even if this means uprooting your family and moving somewhere undesirable.

So many of my W-2 friends have a sense of entitlement. They can't imagine having to buy their own laptops, cell phones, health/life insurance. They're accustomed to employers paying. And these are just the corporate drones, let alone the government employee types. Rich Dad/Poor Dad is a clown on some levels, but one brilliant thing he said is most people go from depending on their parents to depending on an employer to depending on the government. (Some just combine the last two steps and go to work for the government.)

I went freelance/1099 in 1998 in my late 20s. And while there have been highs and lows, not having an employer control 100 percent of my time/life and dictate when and how much time I can take off -- and how much money I make -- has made all the difference. I can't sleepwalk through even one day of work since there's not the automatic W-2 paycheck coming. On the flip side, I can take any day off at a moment's notice. I equate money with freedom, not how much consumer crap I can buy.

Is W-2 employment inhibiting the growth of the American people? Damn right it is. I'm guessing the MMM community has a far lower percentage of W-2 people than American society in general.

Sorry but what a load of bollix, I'm quite happy on W-2 , happy if my employer wants to fund my cellphone, healthcare, dental, and f@cking laptop for that matter, I'm hardly dependent as I stash away 60% plus of my take home, I walk out at 5PM and quite frankly could not a give a shit about the company after that point.
All this chat about starting your own business as if  it's somewhat morally superior, who the f@ck is going to work in these small businesses if we all want to own our own, oh yeah lots of companies out there making cars/tech/medicine all solo operated by owner all that research done by persons on there own, FFS.
Been a small business owner does not make you more or less dependent that a W2 worker - you just replace the employer with been dependent on the customer - oh yeah I'm my own man grovelling on the telephone or standing around some trade show smiling like a chesire f@cking cat trying desperately to peddle whatever sh1te your selling as your next mortgage payment depends on the sale - freedom indeed.
FU money for the win - W2 or otherwise.

[KCM5]

I'm a government employee. And someone who is perfectly happy being a W-2 employee. I work 8 hours/day. My role and work hours are defined and I don't have anything unexpected. I'm not required to work overtime. If I'm unhappy with the arrangement, I'll quit. But I'm perfectly happy.

I have no interest in hustling for contracts. I would like to be able to take long sabbaticals, but that's the reason I'm here - so eventually my whole life can be a long sabbatical if I want it to be.

The American fixation on being your own boss is annoying. I'm glad you're happy with how you have your working situation set up, but that doesn't mean someone who has a different situation is "inhibiting the growth of the American people."

One thing that I do think is inhibiting growth is the way that we tie health insurance to our employment. The ACA has fixed that a bit, but we're mostly still tied to it psychologically.

[Gone Fishing]

The American people are inhibiting the growth of the American people.  Security or even perceived security lulls people into complacency, no matter what the source.  Add the innate desire to conform and attain a perceived status you have the perfect recipe for the corporate world as we know it.  As many here have shown, W-2 employment can be levered to provide a life unimaginable to many.  One just has to have the vision and determination to get there. Sadly, it typically takes some horrific event such as the Great Depression/WWII to shock the masses back into badass mode.  The next "greatest generation" will be forged in fire, and it will not be pretty.     

[Tetsuya Hondo]

There is way too much to unpack here for one thread.

Have you worked for many different employers? Because very little of this reflects what I've seen in my career both as a (gasp!) W-2 employee and in my current work as an independent consultant.

And don't ever refer to others as "sheep." It's incredibly condescending. There are so many explanations for why people do what they do. When you take the time to actually try to understand others, you'll find that there's often good reasons for why they do what they do.

[Vilgan]

I don't see the connection between financial education and w2 employment. Can you clarify that one? Don't all people have to manage their finances regardless of the regularity of the paycheck? Admittedly some people will be more skilled at it than others but I'm not sure if the w2 has much, if anything, to do with it.

When $ stream is less consistent, you need to manage that flow and save up for periods where you don't have money coming in - either because you are between paid work or because a customer is slow to pay. When on W-2, emergency fund is a 'good to have' but if you spend every penny each 2 weeks you'll frequently be fine. When your next check could be 4 months away, saving for the down times becomes a lot more necessary. You'll also have a lot more exposure to how taxes work.

Also what model would replace steady employment that satisfies both employers and employees? You keep mentioning maximizing productivity. It sounds a bit buzzwordy to just drop that and act as if it satisfies everyone.

Good point, I didn't elaborate much. W-2: You are paid to be an employee. Your employer hopes you get lots of work done, but the association is somewhat loose. Skill at "appearing to be valuable" is frequently more important than actual productivity. 1099: If paid per project, then you are paid directly for productivity. Complete project, get paid. If paid per hour, then you are paid per hour of actual work. When itemizing billable hours, "watched cat videos" or "browsed facebook" are not billable. You need to point at concrete things that you accomplished and the hours where you were doing them. The billable rate is usually much higher than the w-2 rate and when you aren't billable you can do whatever non-billable thing you feel like.

Sorry but what a load of bollix, I'm quite happy on W-2 , happy if my employer wants to fund my cellphone, healthcare, dental, and f@cking laptop for that matter, I'm hardly dependent as I stash away 60% plus of my take home, I walk out at 5PM and quite frankly could not a give a shit about the company after that point.
All this chat about starting your own business as if  it's somewhat morally superior, who the f@ck is going to work in these small businesses if we all want to own our own, oh yeah lots of companies out there making cars/tech/medicine all solo operated by owner all that research done by persons on there own, FFS.

Why not separate your employer from that decision about what healthcare you get, what dental, make your own decisions about laptop, and have all that money to make the decision yourself? They aren't paying for that, you are with the reduced rate you make on salary. Typical experienced salaried tech worker makes $50 to $72 per hour assuming they only work 40 hours per week. It gets worse if you are convinced you need to work long hours for whatever reason. Typical experienced 1099 tech worker makes $100 to $180 per hour. Why not pocket that difference and make those decisions about what benefits you want to pay for yourself rather than negotiating it with your employer?

Also, of course you still have teams. It just means the teams come together to get something done and build an app or a car or whatever rather than being a giant pool of "employees".

[sirdoug007]

Also what model would replace steady employment that satisfies both employers and employees? You keep mentioning maximizing productivity. It sounds a bit buzzwordy to just drop that and act as if it satisfies everyone.

Good point, I didn't elaborate much. W-2: You are paid to be an employee. Your employer hopes you get lots of work done, but the association is somewhat loose. Skill at "appearing to be valuable" is frequently more important than actual productivity. 1099: If paid per project, then you are paid directly for productivity. Complete project, get paid. If paid per hour, then you are paid per hour of actual work. When itemizing billable hours, "watched cat videos" or "browsed facebook" are not billable. You need to point at concrete things that you accomplished and the hours where you were doing them. The billable rate is usually much higher than the w-2 rate and when you aren't billable you can do whatever non-billable thing you feel like.

Bullshit bolded.  If you don't think procrastination and internet surfing are billable, you haven't been looking hard enough.  I work a W-2 for a consulting company where we bill hours to our clients and this stuff is rampant.  Sure, you need to produce SOMETHING (eventually) to justify your charges, but that is not to say everything is pure concentration and focus on the assigned task.

Sorry but what a load of bollix, I'm quite happy on W-2 , happy if my employer wants to fund my cellphone, healthcare, dental, and f@cking laptop for that matter, I'm hardly dependent as I stash away 60% plus of my take home, I walk out at 5PM and quite frankly could not a give a shit about the company after that point.
All this chat about starting your own business as if  it's somewhat morally superior, who the f@ck is going to work in these small businesses if we all want to own our own, oh yeah lots of companies out there making cars/tech/medicine all solo operated by owner all that research done by persons on there own, FFS.

Why not separate your employer from that decision about what healthcare you get, what dental, make your own decisions about laptop, and have all that money to make the decision yourself? They aren't paying for that, you are with the reduced rate you make on salary. Typical experienced salaried tech worker makes $50 to $72 per hour assuming they only work 40 hours per week. It gets worse if you are convinced you need to work long hours for whatever reason. Typical experienced 1099 tech worker makes $100 to $180 per hour. Why not pocket that difference and make those decisions about what benefits you want to pay for yourself rather than negotiating it with your employer?

Also, of course you still have teams. It just means the teams come together to get something done and build an app or a car or whatever rather than being a giant pool of "employees".

Between W-2 and 1099 you are making a trade-off between steady income and pay rate.  In some situations the steady income may be a much better deal.  To say the pay is higher ignores the fact that you may not get paid for a lot of time you put in. 

You are trying really hard to make a point that 1099 is better but this is always a case by case decision.  In many cases W2 may be a better deal.

[matchewed]

I don't see the connection between financial education and w2 employment. Can you clarify that one? Don't all people have to manage their finances regardless of the regularity of the paycheck? Admittedly some people will be more skilled at it than others but I'm not sure if the w2 has much, if anything, to do with it.

When $ stream is less consistent, you need to manage that flow and save up for periods where you don't have money coming in - either because you are between paid work or because a customer is slow to pay. When on W-2, emergency fund is a 'good to have' but if you spend every penny each 2 weeks you'll frequently be fine. When your next check could be 4 months away, saving for the down times becomes a lot more necessary. You'll also have a lot more exposure to how taxes work.

Also what model would replace steady employment that satisfies both employers and employees? You keep mentioning maximizing productivity. It sounds a bit buzzwordy to just drop that and act as if it satisfies everyone.

Good point, I didn't elaborate much. W-2: You are paid to be an employee. Your employer hopes you get lots of work done, but the association is somewhat loose. Skill at "appearing to be valuable" is frequently more important than actual productivity. 1099: If paid per project, then you are paid directly for productivity. Complete project, get paid. If paid per hour, then you are paid per hour of actual work. When itemizing billable hours, "watched cat videos" or "browsed facebook" are not billable. You need to point at concrete things that you accomplished and the hours where you were doing them. The billable rate is usually much higher than the w-2 rate and when you aren't billable you can do whatever non-billable thing you feel like.

So freelancers and entrepreneurs never run into money problems and always manager their finances well? I think you're taking some broad assumptions and are trying to apply it in an awkward manner. What your saying just doesn't ring true and lacks some serious nuance.

sirdoug007 had criticism towards the second part that surpassed mine.

[doubled85]

Also, not everyone in a W-2 role is just seeking a job to be lazy, work til they're 65, etc. Some folks are career oriented and have a specific path in mind. Perhaps they want to be an expert in their field and the best way to do that is work for one employer at a time on W-2. Yes, there are trade offs but being a 1099 isn't without trade offs either.

Anecdote time: coworker's significant other is a 1099 employee. He's responsible for his own health insurance, retirement, WC, gen. liab., his own tools, etc. He doesn't want to buy health insurance nor does he see a benefit in funding his own retirement - that's his choice, I suppose. Here's the catch: 100% of his work comes from exactly one guy. Sounds like an employee to me and one that isn't making the best decisions for his future self.

Contrast that with a W-2 employee that's taking advantage of their employer 401(k) match, their subsidized health insurance, their paid tools, etc. and is budgeting at home. Who's in better shape?

[big_slacker]

I have worked 1099, W2 and under the table multiple times each in my life. All have pros and cons. I'm W2 right now and have some serious financial upsides in return for giving up some freedom and flexibility.

Yes it is nice to make your own way and be your own boss from a freedom and mentality perspective. You have a lot more hanging over your head too. I think it's a good thing to experience both and decide how you want to play it.

I think the American people's relationship with money is inhibiting their growth. It's generally accepted that the treadmill of more stuff, more bills, more work is just a fine and dandy way to go about life. If you've adopted the MMM style view of finances then it kind of doesn't matter W2 or not.

[reader2580]

I have worked both as a W-2 employee and I ran a business for five years.  I personally prefer being a W-2 employee.

I ran my business in the 90s.  It never made any money, but never lost money either.  I had six employees at the end including myself.  I paid myself a modest salary.  All full time employees got 100% paid healthcare and paid vacations/sick leave.  I spent a fair bit of time dealing with government regulations around employees and all that.  I sold the business at five years and made enough money to bring my total compensation over those five years to be the same as my starting salary at my next job.  I liked some of the flexibility of being able to just do stuff during the day if I needed to.  I also basically never stopped working.  I would work a full day at the office and then go home and go right back to work for much of the evening.  It was stressful hoping that $50,000 would come in the door every month to meet payroll and pay the bills.

As a W-2 employee I don't have the stress of worrying about where the money will come from to pay the bills.  I get paid vacation and don't have to worry about the company going to heck while I am gone.  I get a nice paycheck every two weeks that I don't have to worry about it bouncing.  I may not make as much money as maybe I could make as contract, but no worrying about companies cutting all the contractors when times get hard.  (My employer cut every contractor when things got bad.)

[Fishindude]

Interesting.
In some respects I think the original posters thoughts are right on the mark.

I also feel like direct deposit, electronic banking and debit cards have gone a long way towards dumbing people down financially.
There was a certain amount of financial stewardship  and planning required when you were handed a check at the end of the week, then had to go to the bank to pay debts, deposit some in checking, keep some cash for spending, write checks for payments, etc.

[NoraLenderbee]

Sorry but what a load of bollix, I'm quite happy on W-2 , happy if my employer wants to fund my cellphone, healthcare, dental, and f@cking laptop for that matter, I'm hardly dependent as I stash away 60% plus of my take home, I walk out at 5PM and quite frankly could not a give a shit about the company after that point.
All this chat about starting your own business as if  it's somewhat morally superior, who the f@ck is going to work in these small businesses if we all want to own our own, oh yeah lots of companies out there making cars/tech/medicine all solo operated by owner all that research done by persons on there own, FFS.
Been a small business owner does not make you more or less dependent that a W2 worker - you just replace the employer with been dependent on the customer - oh yeah I'm my own man grovelling on the telephone or standing around some trade show smiling like a chesire f@cking cat trying desperately to peddle whatever sh1te your selling as your next mortgage payment depends on the sale - freedom indeed.
FU money for the win - W2 or otherwise.

+2

When $ stream is less consistent, you need to manage that flow and save up for periods where you don't have money coming in - either because you are between paid work or because a customer is slow to pay. When on W-2, emergency fund is a 'good to have' but if you spend every penny each 2 weeks you'll frequently be fine.

This is a silly thing to say on this forum, because the people here are all about managing money and saving for a future without work.

[Blonde Lawyer]

You are missing that 1099 employees are paid more because they pay self employment taxes while for W2 employees, the employer pays those taxes.  When you work out the tax differences, the pay rate is very similar.

Also, I had to laugh re: cat videos and facebook.  I'm a salaried employee that has to track my time in 6 minute increments to bill to clients.  I'm great at looking productive.  I'm looking for a job where I can work less and not have to track billable time.  That way I'm judged just on my output/work product and not how many precise minutes I billed.  I enjoy taking breaks throughout the day and I don't want to make up that time later.  I guess I'm the person you are ranting about.

[RootofGood]

I didn't really mind being a W-2 worker.  It was always completely at will in my 2 professional jobs I held.  One I left on my own terms with 4 days notice.  The other I left on my employer's terms with about 7 minutes notice (not including the 10 minutes to walk to my car and retrieve and return the organization's iPad). 

They paid me, I did stuff.  We generally got along.  Then we parted ways. 

1099 and W-2 are just different tax treatments and theoretically come with different business relationships (but those lines are usually muddled in practice). 

Though mostly retired, I do 1099 type work for a few hours per week.  It's nice, and I probably won't ever go back to w-2 work unless it's for fun (which is what my 1099 work is currently). 

[Cpa Cat]

As a CPA, I see a variety of situations.

It takes a certain kind of personality to be successful as a self-employed individual. Not everyone is cut out for it. Not every single person is designed to "grow" independently.

Many of my self-employed clients would be much better off as W-2 employees. They are extremely hard workers - and very poor business people. If they were salaried and working for someone else, they would have more security, more money, and be working less.

When I left my old accounting firm (I held a job that precisely fit your definition of W-2 as soul-killing cubicle farm), most of my coworkers were shocked that I would take the risk to be self-employed. They didn't even understand how they would find clients outside of the firm environment. And most of them were correct that it would be a terrible move for them - they lacked the personality-type to get out, network, take risks. Many of them were hard working and intelligent, but needed to be lead by someone. Others were unmotivated and ambivalent - traits that doom self-employment to failure.

For the record - I watch more cat videos now that I'm self-employed.

[NICE!]

Since the first two comments were about this, let me clarify before this gets too off track: no one is subsidizing this.  In other countries, perhaps.

I think most people would realize that this wasn't a country-specific comment. Many Americans advocate for policies like those in northern Europe. I believe the question is valid - why should I help subsidize someone's maternity/paternity leave rather than someone's backpacking expedition? Both are personal life choices.

And to the poster that said it isn't a vacation, that's beside the point.

**end detour**

[JZinCO]

Also what model would replace steady employment that satisfies both employers and employees? You keep mentioning maximizing productivity. It sounds a bit buzzwordy to just drop that and act as if it satisfies everyone.

Good point, I didn't elaborate much. W-2: You are paid to be an employee. Your employer hopes you get lots of work done, but the association is somewhat loose. Skill at "appearing to be valuable" is frequently more important than actual productivity. 1099: If paid per project, then you are paid directly for productivity. Complete project, get paid. If paid per hour, then you are paid per hour of actual work. When itemizing billable hours, "watched cat videos" or "browsed facebook" are not billable. You need to point at concrete things that you accomplished and the hours where you were doing them. The billable rate is usually much higher than the w-2 rate and when you aren't billable you can do whatever non-billable thing you feel like.

Bullshit bolded.  If you don't think procrastination and internet surfing are billable, you haven't been looking hard enough.  I work a W-2 for a consulting company where we bill hours to our clients and this stuff is rampant.  Sure, you need to produce SOMETHING (eventually) to justify your charges, but that is not to say everything is pure concentration and focus on the assigned task.

Sorry but what a load of bollix, I'm quite happy on W-2 , happy if my employer wants to fund my cellphone, healthcare, dental, and f@cking laptop for that matter, I'm hardly dependent as I stash away 60% plus of my take home, I walk out at 5PM and quite frankly could not a give a shit about the company after that point.
All this chat about starting your own business as if  it's somewhat morally superior, who the f@ck is going to work in these small businesses if we all want to own our own, oh yeah lots of companies out there making cars/tech/medicine all solo operated by owner all that research done by persons on there own, FFS.

Why not separate your employer from that decision about what healthcare you get, what dental, make your own decisions about laptop, and have all that money to make the decision yourself? They aren't paying for that, you are with the reduced rate you make on salary. Typical experienced salaried tech worker makes $50 to $72 per hour assuming they only work 40 hours per week. It gets worse if you are convinced you need to work long hours for whatever reason. Typical experienced 1099 tech worker makes $100 to $180 per hour. Why not pocket that difference and make those decisions about what benefits you want to pay for yourself rather than negotiating it with your employer?

Also, of course you still have teams. It just means the teams come together to get something done and build an app or a car or whatever rather than being a giant pool of "employees".

Between W-2 and 1099 you are making a trade-off between steady income and pay rate.  In some situations the steady income may be a much better deal.  To say the pay is higher ignores the fact that you may not get paid for a lot of time you put in. 

You are trying really hard to make a point that 1099 is better but this is always a case by case decision.  In many cases W2 may be a better deal.

Likewise, I want to add that I have worked as a w-2 in a position where I was judged on my daily production. I would have been canned for not meeting daily production consistently. Also if my work did not meet quality control I would have to 'volunteer' a day to go do the work again (maybe not legal) and if I failed two quality checks I would have been canned. I personally like judging my work based on production, whether in my w-2 or 1099 position but I also think that a production driven environment can produce low morale, which in turn lowers productivity.

[mr_orange]

You don't have to earn money strictly from 1099 income.  This is employee thinking.  If you own a business you potentially control the time of others along with other resources to increase your wealth.  The choice isn't simply between "a higher rate" via a 1099 selling your time and a lower rate via a W2 that is steady. 

[Gimesalot]

I have always been a W-2 employee and unless I am employed by a company as a 1099 employee, I will NEVER EVER EVER consider doing my job as "my own boss".  Why?  Because I choose my happiness over doing things I hate for money. 

For example, if I wanted to open my own engineering company, I now have to take on all of the HR functions, accounting functions, business development functions, etc.  Sure, I might get paid a little more, but not enough to justify how much I would hate doing those things.  Eventually I might become successful enough to hire someone to do all that crap for me, but you know what, I rather save my free time to travel and make a little less without the stress.