But no, companies like Google want to have their cake and eat it too: they want a class of workers where they can require of them more or less the exact same things that they require of their employees (and much more easily fire them), but can give them a lot less, and treat them like a second class.
That's entirely Google's choice. It does not have to be that way. But they've decided to create this two-class system for their own benefit, not for anyone else's.
Also consider that these people are probably often not contractors in the legal sense. They're likely W-2 employees of some sort of staffing agency, who are then placed at Google. Google pays the staffing agency, the staffing agency pays the "contractor" a salary (significantly less than what Google pays the staffing agency), and all is fine... legally, anyway.