Have we reached a turning point in the employment where the percentage of staff in companies that are ‘associates’ versus being on permanent employment contracts is rising? We’ve certainly come across more examples of companies where the size of workforce ebbs and flows with the work as it comes in, and they rely on associates/freelancers to be agile.
A friend and I debated this the other day. Of course, here at KindredHQ, we love the idea that companies are sourcing their talent from the freelance community, but my friend made a very good point. Who benefits most? The company, or the freelancer?
Some commentators would also argue that the current global economic situation is behind the spectacular rise in the number of people choosing an independent career, and that this isn’t necessarily a good thing with many forced into self employment because they can’t get a job. We can’t argue that this doesn’t happen. But we can look at what needs to happen to make self-employment and an independent career a very realistic, fruitful option.
In some ways, we have the perfect storm. The combination of
– Rapid technological change and a globalised economy
– Millennials who value happiness and fulfilment over stability
– The death of the job for life
That’s why things have to change.
Too many companies still think that things will get better, that they can still control their workforce in the way that they did before. That’s why you hear so many horror stories of companies that demand the same of their freelance workforce as they do of their permanent staff, but without any of the benefits that go along with this. Essentially a two-tier caste system. Bills not paid on time, no benefits, unreasonable hours etc.
And then there is the issue of the State. Don’t be looking there for help. It is rare indeed for governments to support the freelance workforce with practical help. You’re on your own. Stuck in between that rock and a hard place.
We need to rethink the modern ‘employment contract’.
To do that, we need a few things to happen:
1. Be realistic – jobs are not for the long term
An employment contract that recognises the fact that often you aren’t in a long-term relationship with your employer and where both parties are honest about this is the way it should be. That doesn’t mean that businesses aren’t about maximising profit and that this will ultimately benefit the business. In fact, handled properly, it’s a case of sharing the rewards. Just because you aren’t on the payroll, it doesn’t mean that you shouldn’t be financially rewarded for making a great contribution
Once you take long term loyalty to one employer out of the equation, you create a workforce of entrepreneurs who are used to uncertainly and fluidity. People who want to prove their worth every day, and who yearn for projects that keep them productive.
2. Value happiness alongside profit
Moving jobs frequently means much greater job fulfilment and it keeps you energetic in your role. If I’m honest, I overstayed some job roles earlier in my career by a year or two. You know the score, you start with such enthusiasm, only to find that you fall out of love with it a year or two later, once you realise that your personal values are not quite aligned with the organisation.
But it also means that you are constantly learning. These days, because of the economic situation, there is little or no stigma to leaving a job early. Workers today know they could be made redundant at any time. It begs the question why most still consider long term commitment.
3. The freelance economy needs underpinning
We paint a rosy picture, but there’s a but. The downside to the freedom freelancers enjoy is that there is no financial security regardless of the type of work you do and the demand. Things can change anytime and you can’t rely on any client to keep working with you.
So here’s the elephant in the room.
How can we create a positive, creative working culture where freelance and independent careers are the norm without having any degree of security?
That job creation engine that governments across the world usually rely on isn’t kicking in yet, as it usually does following a recession. Despite the mini incentives that governments are dangling in front of us, businesses aren’t hiring.
What has happened is that the numbers of self employed and other independent businesses have increased. That’s because the traditional business model doesn’t apply anymore, due to a number of factors, including technology and a globalized market.
We have to accept that we now have a freelance economy that isn’t an ‘also ran’. There’s still money to be made, innovations to be marketed, advice to be sought. The difference is that many businesses today are choosing to hire on an as-needed basis, relying on a freelance workforce. The difference between now and a few years ago is that the freelance workforce has started to realise its power and value. Our ranks include confident, talented folk who prefer to take control of their own careers. Businesses who don’t understand that the balance of power has changed will lose out on the very best talent in the future.
Unfortunately, the Establishment doesn’t yet see it like that. And whilst they don’t, freelancers have little or no rights. Clients can choose not to pay bills and most freelancers can’t afford to sue them for the money. There are paltry incentives from Government on offer to small businesses that only seem to take people further into debt. Occasional working space to collaborate and use common services like printing or start up advice has all but been withdrawn by the Government and the private sector models are too expensive for most freelancers who aren’t in receipt of funding.
That’s why we need to consider a new platform
The Freelance economy is not going to go away. It’s inevitable that it will continue to grow. But unless we consider the underpinning, the foundations, we are storing up new problems for the future. This isn’t a political position, but it is a social position. It’s really important for us to get this right, because this is about the health of our communities and economy.