Ep. 26 - The Gig Economy: The Momentum and Impact of the Independent Worker - with Steve King
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We are witnessing an evolution in the composition of the workforce: the continual growth and increased impact of the independent worker, otherwise known as freelancers, contractors, and independent consultants.
With what is called the Gig Economy, the profile of these independents has also been shifting – they reflect people across a variety of knowledge-intensive industries like management consulting as well as those from creative occupations. The commonality, though, is that many have chosen to pursue an independent path.
Companies increasingly want and need these workers in order to adapt to the ever-changing business environment.
To learn more about the impact that independent workers are having on businesses, we’re talking to Steve King, Partner at Emergent Research. His research and consulting company studies the future of work, particularly the trends of this independent workforce.
Being an Independent Worker - Walking the Walk
Steve has a unique perspective on this topic because he doesn’t just study it – he lives it every day, and he has for about 20 years.
Steve left his job as CMO of a publicly traded tech company because he wanted more flexibility and balance in his life.
“When you're working for a corporation and you're working full-time and you're working hard, time passes very quickly because you’re planning your life as long as a year out in advance...and you just kind of wake up one day and go what happened to the last six months?”
But by becoming an independent worker and starting Emergent Research with his wife, Steve “got a much better appreciation for life in general” and things slowed down for the better.
Steve and his wife live the independent worker life; they aren’t just students of the field, but active participants and examples themselves.
The Momentum Behind the Independent Workforce & Gig Economy
The independent workforce has been growing consistently – 3x the rate of the overall workforce for the last decade. In fact:
Most growth and most people are doing it part-time or 2nd/3rd sources of income
The number of highly skilled workers or highly compensated workers (those who make more than $100K a year) has gone up ~70% since 2011-13 – a huge shift.
And it’s not just Millennials – this cuts across multiple generations, as many Boomers are now interested in pursuing their passion. In contrast, Middle-Agers are looking for the most stability.
Grow Drivers - Flexibility, Agility, and the War for Talent
Companies are looking for increased levels of flexibility and agility in order to compete in this ever-changing business landscape – and freelancers, consultants, and contractors fulfill this need. And you will now find independent workers in very key roles.
“You go back 20 years, pretty much every company would list cost as the primary reason that they hire independent workers. Now when they do surveys of hiring managers, cost comes in 5th or 6th. The top reasons a company looks for independent workers today are scarce talent, flexibility, and agility.”
With the tight labor market, there’s also a labor shortage particularly for certain types of talent. In many of cases they can’t find full-time hires to fulfil the role so hiring an independent worker is their only choice.
But also, companies are realizing they may not necessarily need or want someone long-term so consultants can come in to fill that need which helps them reduce costs. And that is another reason for the desire for flexibility and agility.
Key Takeaways:
On the supply and demand side, there is a shift towards greater levels of independent work.
With companies looking for increased levels of flexibility and agility, independent workers help create the necessary business momentum to address important strategic initiatives while also giving them ability to tap into a pool of talent by expanding their reach in a virtual way.
Steve is seeing a “disaggregation and atomization of work.” More and more work is being done by teams that form up and deform and it’s easy to plug in independent workers.
Share of people working in teams that do project work are becoming more and more comprised of internal employees and external consultants of which that is projected to grow.
On the flip side, individuals are coming to the realization that they may not want to continue as a corporate employee – they too seek greater flexibility and control.
Various online marketplaces like Catalant, Toptal, Upwork are available to find highly skilled workers, but the main avenue is still word of mouth. So whether you’re hiring or looking to get hired, tap into your network!
Steve’s 3 tips for anyone interested in the independent life:
The first biggest challenge of independent work is the revenue is unpredictable. It's inconsistent, and lack of predictable revenue is the single biggest complaint. So don’t quit your day job and create a financial cushion
If possible, start part-time and try it out. You’ll want to see if the market is willing to pay for what you’re offering and get used to being independent.
Don’t commit until you’re confident that you will get hired by at least one potential client.
Independent work isn’t for everyone – so know thyself, plan for risk, and set up a plan to test and learn to see if this ultimately aligns to what you want.
Resources:
Learn more at smallbizlabs.com
Connect with Steve at emergentresearch.com
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