With the fiscal cliff behind us and 2013 ahead, many Americans are coming to terms with the fact that the relationship between employees and employers has changed.
Trends are showing more workers are choosing to work independently. Companies large and small are embracing the idea that a traditional W-2 employment relationship isn’t the only way to get work done. Awareness of the nearly 17 million “non-employees,” or independent workers, has finally entered the corporate mainstream.
Whether it is outsourcing a function, engaging a consultant or consulting firm, chopping up work into small projects or using freelancers, retired employees and even crowd sourcing, companies just don’t need as many employees as they did 5 years ago. The new workforce model in business today includes a percentage of the workforce comprised of consultants, contractors and freelancers. Many companies consider as much as half of their workforce as “non-employees.”
The movement towards independent work isn’t just a fad – it’s a true structural shift. That shift comes from a perfect storm of changing values, the economy and technology. Due to the recession, a number of people were forced to consider self-employment to supplement their income or because jobs were tough to find.
At the same time, people were prioritizing flexibility and fulfillment over security and climbing the corporate ladder. 80 million late-career experts (Baby Boomers) recognized they wanted new ways to work, to extend their work life and supplement their retirement. With pressure on companies to do more with less, even as the economy recovered, managers were not free to add employees, so they got creative. They created projects for small groups of consultants or they brought their laid-off or retired workers back to work part-time and treated them as independent experts, offering them 1099 work arrangements. Simultaneously, technology advances enabled workers to be remote; working from home, plugging in at Starbucks, and even subcontracting freelancers from overseas. There was no need for office space, benefits, supervision, performance appraisals or pink slips when the project ended. They turned in their work with an invoice and they got paid out of the budget for that project. It turns out people didn’t need to be employees after all. Employers need workers, but not every worker needs to be in a fixed, long-term employment contract.
For a more detailed perspective on the systemic changes, and how to address and capitalize on them, see the article, “The Way Work Gets Done in the Emerging Project Economy,” here or visit the MBO Partners site at: www.mbopartners.com.
By Jay Lash, from: http://www.mbopartners.com/blog/way-work-gets-done-emerging-project-economy
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