In addition, hiring a subcontractor is usually less expensive than hiring a full-time employee, because the small business is not required to pay Social Security taxes, workers' compensation benefits, or health insurance for independent contractors.

Is subcontracting more expensive?

When your business needs some extra hands on a large project, hiring subcontractors is often much more cost effective than bringing on new, full-time employees. ... When all is said and done, hiring a subcontractor is about 20 to 30 percent more cost effective than hiring full-time additional staff.

Why is subcontracting bad?

Subcontracting in general is where one company will take a piece of work and give it to some other business organization to carry out that work. ... The more subcontracting, the more “fissuring” of the work, the greater the risk for health and safety at the bottom of those chains.