I work for a contractor and I’ve always wondered why they hire us when I get paid $30 a hr and obviously my boss is making a cut on top of that. But the company I’m painting for only pays there employees $18 per hr? Wouldn’t it be easier just to hire an extra employee to preform simple tasks like painting, shoveling stone, ect these are all none skilled labor jobs.
In: Economics
It might be cheaper per hour for them to hire that employee, let’s say $20/hour. But if they don’t have enough stuff to paint, then that employee is getting paid to do nothing. Or they only have the employee as part time/casual which means they may not be available to work.
Now comes in the contractor. They pay me $30/hour and I pay you $25 per hour. So I send you in to that same location to do 8 hours worth of work once a week. But I also have four other businesses that also only require 8 hours worth of work every week. So each individual place pays more per hour, but less overall. And they have someone available whenever they need it. And I make money being the middle man, providing you with supplies and storage and benefits. And you are working 40 hours a week instead of 8. Everyone wins.
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