What is the difference between general contractor and subcontractor
When preparing for a construction project or looking to work in the construction industry, you must learn about the differences between a subcontractor and a general contractor. They are both important to any construction project's success, but their roles, career path, and mode of work are very different. In this article, we will delve into those differences in detail.
Role Comparison: General Contractor and Subcontractor
General Contractor (GC)
A general contractor is the primary overseer of a building project. The GC oversees the project from start to finish, responsible for planning, budgeting, hiring subcontractors, scheduling, obtaining permits, and ensuring the work adheres to all building codes.
Subcontractor
Subcontractors are specialists whom the GC contracts to execute certain aspects of the work. As an example, a GC might contract a plumbing subcontractor to do all the plumbing or an electrician to install electrical systems. Subcontractors typically specialize in one craft and do not have direct dealings with the property owner.
Responsibilities Breakdown
Project Scope
GCs are responsible for the entire project scope, ensuring all the moving pieces fit together well. Subcontractors are only responsible for their particular task within that project.
Legal and Financial Responsibilities
General contractors possess the primary contract and are legally liable for the entire project. Subcontractors work under agreements with the GC and are responsible for the quality and timely delivery of their specific tasks.
Coordination and Communication
A GC is also the interface for all other stakeholders to the client. The GC is the person who the subcontractors report to, and they never really talk directly to the owner of the property.
Career Path and Work Environment
Working for a GC
Workers who work for a general contractor will see that there are increased opportunities for career development. GCs usually have more structured companies and might even offer training, certification, and well-defined jobs in project management or supervision.
Working for a Subcontractor
Subcontractors, especially smaller firms, may offer more hands-on trade work but less formal career advancement. Progression and opportunities may be more based on seniority or firm connections than performance or talent.
Income and Pay Structure
General Contractors
GCs tend to earn more money in total, especially when working on high-level projects. They make their earnings from markups on jobs, coordinating subcontractors, and handling the build in an efficient way.
Subcontractors
Some subcontractors will earn more per hour due to their specialty. However, since they work smaller scopes and also have to rely on regular GC contracts, their net pay may be lower than that of a GC.
Types of Subcontractors (with Examples)
Subcontractors are engaged in numerous specialties, such as:
Site Preparation: Land clearing and preparing land for construction
Concrete: Pouring foundation, slabs, and structural supports
Framing and Structural Work: Framing the skeleton of the structure
Roofing and Siding: Protection and insulation of exterior shell
Plumbing, Electrical, HVAC: Basic utilities
Carpentry and Finishing: Interior finish work such as trim, cabinetry, and fixtures
Real-World Examples
A homeowner who is doing a full rehab will most likely hire a general contractor to oversee the project. That GC will then hire subcontractors like plumbers and electricians to complete specialty portions of the work. All the trades have an extremely important role, but only the GC is responsible for organizing and directing the whole process.
Taking the Right Path
For Property Owners
If you're building or rebuilding, having a GC is simple. They deal with scheduling, logistics, and subcontractor coordination. But if you're experienced and want to save money, you can work with one subcontractor yourself, but it requires more effort.
For Job Seekers
If you prefer a structured career with a potential for progression, employment by a general contractor might be ideal. If you desire to specialize and be self-employed, becoming part of or setting up a subcontracting company may be ideal for you.
Conclusion
While both subcontractors and general contractors play vital roles in the construction process, their responsibilities, salaries, and career paths differ significantly. Understanding how they are different will make you a more informed decision-maker if you're operating a project or choosing a career in the construction industry. Take the right path based on your goals, credentials, and level of responsibility you're ready to take on.
For example Freeman Construction LLC is a general contractor in Longmont CO you can call if you need and we will also provide you with subcontractors
Frequently asked questions
Is it better to work for a general contractor or subcontractor?
Generally speaking, general contractors offer more structured career advancement. Many GCs have systems in place for promotions, training, and certifications—especially for team members who show initiative. On the other hand, subcontractors, especially smaller firms, may rely more heavily on seniority or internal politics when it comes to promotions, which can limit growth for newer or high-performing workers. You can listen to that answer in this video we've made: https://www.youtube.com/watch?v=oG3TxRtaWso
Do subcontractors make more than general contractors?
Subcontractors with niche skills may sometimes charge higher hourly rates due to their specialization. However, general contractors usually earn more overall because they oversee entire projects, manage multiple trades, and carry more responsibility. The ability to coordinate and deliver complete results often leads to higher compensation.
Who makes more money, contractor or subcontractor?
On average, general contractors earn significantly more annually than subcontractors. A GC in the U.S. earns about $121,000 per year, while subcontractors average closer to $71,000. While subcontractors can increase their income by taking on more jobs or focusing on high-demand trades, GCs benefit from broader profit margins and project control.
What are the three different types of subcontractors?
Subcontractors can be grouped based on the phase or specialty of construction.
For example: Site Prep Contractors – clear and level land before construction starts
Structural and Framing Crews – handle the skeleton and core structure of the building.
Finish Specialists – such as plumbers, electricians, HVAC technicians, and carpenters, who focus on specific, essential systems or interior work.