Yes, absolutely playing with others will make you a better player. It's one thing to be able to play alone, but to be able to play in time with a group of musicians is another matter entirely. Ideally, you'll get in a situation where they'll push you, you'll push them, and everyone gets better.
That said, a band can be extremely frustrating. Such as, band members with personality issues, substance issues, egos, flakiness. I just don't have the patience to deal with that like I used to.
+1 ... You'll never be the player you can be playing at home alone!
I've been playing at home and doing pickup gigs for the last few months - having spent most of 2012 working every weekend - and it's
*driving me NUTS!* Got sub gigs coming up the next couple of weeks - which is nice - but they're sub gigs, so I'm the hired gun. It's not the same a being a full-time band member, part of a team!
I ABSOLUTELY LOVE playing gigs, so I'm looking for a new home right now. I'm not a pro (have a well-paying day job), but it's not my first dance, so the number of garage bands, wannabe's, flakes, etc. and those who grandiose ideas of their skills and long term plans that you may encounter (and I have) is frightening !!
The good thing about being in a band is that it
WILL challenge you to improve your playing to keep up with the team!
For example - way back when musicians actually made decent money for gigs - I was the 2nd guitar in a band, getting some leads that the lead guitar didn't want or couldn't do! It split up and some of us tried to form a new band. The singer we asked to join, didn't work out so the NEW [and very good] lead guitar player, who also sings, volunteered for the role, but said he wasn't doing both jobs. I was "handed" the job of lead guitar. I protested, saying that I wasn't a lead guitar player. They said "You are now!". I was forced to step it up to a whole new level!
Personality is BIG deal when you are part of a band. It's a "right to work state" kind of job, with no contracts or union stuff and commitment varies dramatically. My best advice is to find a good group of guys/gals that you have a fit with and make good music. If the $$ and gig comes as a result, so much the better.