Contractors in the UK earn more or less the same as other employees (once you account for benefits and paid holidays and sick leave), but do not pay taxes because of a loophole that hopefully will be fixed by IR35.

This is definitely not true. I've been contracting for 6 years in London, and am currently in an inside IR35 role, and have quite a few friends in the same space but in frontend/devops and its all the same. The differnce is atleast 2x for senior/lead engineers in golang or python.

In my experience, a company that pays 400-500£ per day for a contractor, will pay 80-90K£ per annum for a permanent employee. Once you account for VAT and corporation tax, the only difference comes from not paying NI and income tax. Inside IR35, if my calculations are correct (and they may not be), 500£ per day are equivalent to 90K£ per annum.

Contracts often fall into one of two categories.

There's the consultants who make the big bucks. They come in to solve a particularly thorny problem that an org has and then the contract is done and they move on.

There's also the staff argumentation contracts. We need six devs, but because of how accounting works, we can only hire two FTEs. However, contractors are part of an operations budget rather than a engineering budget... and so we can hire four devs as staff argumentation instead.

Another example of staff argumentation would be some place where there's a flex in the amount of work to be done. Long ago, I worked tech support. About 25% of the staff was FTE while the remaining 75% weren't. It was claimed that it was so that it would be easier to flex down (or up) when demand for the tech support slacked off or if it shot up (it did a few times go up with new OS releases).

The staff argumentation dev role is not as prestigious as a consultant.

> argumentation

augmentation?

That too... the debates I've had... oh... yea, I spelled it wrong. The perils of autoincorrect.