This summer I was not laid off, but I was pretty much told "no part time workers."
The bad part about me being told that is that I started working part time for a few weeks because I was just finishing up classes in my spring 05 semester.
So in other words I started part time for a few weeks, worked full time for a few months, and quit because I could not work part time.
The union at the place I worked did not want "part timers".
Oh, well the job paid good, but it stunk so...
BTW I got a better part time job now with a little less pay so it works out!
I would say keep the contractor job and if you can afford it get the health insurance. While working as the contractor just do some job searching and if you find something quit! If you have to, don't put in you're two week notice, only if the new job that hires you needs you immediately.