Short Answer: It is another way of saying non full-time employee (non-W2 wage employee in US)
There are benefits and pitfalls in this type of contracts that an individual developer should be aware of. Thus, it pre-assume that you are hired for the contract with hourly pay without any benefits (healthcare, sick days, holidays, 401K, vacation).
Although offered hourly pay is much higher than standard full-time employee (W2), it has no benefits like healthcare coverage, which is important for a family with kids.
Thus, if you are single, pretty healthy and don't need your company benefits then switching to be consultant (1099 in US) will bring more cash to your pocket.
Another positive benefit is that you should constantly better manage your work, combined with self-motivation to learn and deliver results in the shortest time frame. In another words, if you have character to be better while constantly competing this might be your arena of glory.