HowFreelancersAreShapingtheFutureofWorkDisruptive InnovationFestival- OpenMicSession

MarcoTorregrossaSecretaryGeneral,EuropeanForumofIndependent Professionals

ManagingDirector,EuroFreelancers

17November2016

TheNewYorkCity’ssubwaysystemhas reported inApril2015that,forthefirsttimein30years:

… thisisbecausepeopleareditching theconventionalcommutetoa9-to-5job, sotheycanliveandworkdifferently.

TheRushHourisDying!

“weekdaygrowthwasstrongestoutsideofthetraditionalmorningandeveningrushhours”.

TheShorteningofWorkRelationship

Type

Contract

Length

Place

Protection

Employee

Open-ended

Decades

In-house

Linkedtopremises

Subcontractor

Temporary

Years

Out-house

Linkedtostatus

Freelancer

Self-employed

Months/Days

Home/Cowor-kingspace

Linkedtoindividual

Ondemand

Services

Hours/Minutes

Platforms

Tobeinvented

AdaptedfromThomasMalone– Thespectrumofjobs

Eurostat,2015

1. AhighdegreeofautonomyFreelancersexercisecontrolovertheirworkloadandportfolio,givingthemagreaterdegreeofflexibilitythanemployees.

2. Paymentbytask,assignment,orsalesFreelancersarepaidfortheiroutput– thecompletionofaproject,ratherthantheirinput– numberofhoursworked.

3. Short-termrelationshipwithclientsFreelancersperformshort-termassignments.Theycanbegintoworkimmediatelywithoutinfrastructures,funding,abusinessplanandoftenlearnbusinessskillsastheygo.

4. MeasuringgrowthinunconventionalwaysFreelancerswanttokeeptheirbusinessatamanageablesize,balancingincomegenerationwithcreativity,freedom,self-relianceandwell-being.

HowtoSpotaFreelancer

1.Full-TimeFreelancers[40%ofallfreelancers]Traditionalfreelancerswhoderivetheirprimaryincomefromindependentworkanddonothaveanemployernoremployeesbut insteaddofreelanceworkonaproject-to-projectbasis.E.g.Aself-employedchiropractorinprivatepractice.

FreelanceSegmentation

2.Part-TimeFreelancers(Moonlighters)[45%ofallfreelancers]Individualswithmultiplesourcesofincomefromamixoftraditionalemployerandfreelancework.E.g.Aself-employedprofessorwhoalsogivespaidspeechesandwrites/sellsane-book.

3.TemporaryWorkers[10%ofallfreelancers]Individualswithasingleemployer,client,job,orcontractprojectwheretheiremploymentstatus istemporary.E.g.Aself-employedbusinessconsultantworkingforoneclientonacontractbasisforamonth-longproject.

4.FreelanceBusinessOwners[5%ofallfreelancers]Freelancerswhoprovidetheirservicesthroughalimitedcompanyratherthanasasolotrader.E.g.Aself-employedsocialmarketingguruwithherownone-personcompany.

Consultants PR/Marketing prof. ITprof. Journalists

Real estateprof. Painters Translators/Interpreters Magicians

Footballplayers Top models HR/Headhunters Writers/Editors

Interior designers Meteorologists Virtualassistants Therapists

Socialworkers Privateinvestigators Fitnesstrainers Photographers

Socialmedia prof. Exoticdancers Actors/FilmMakers Gamedevelopers

Bloggers Musicians/Singers Tourguides Medium/Fortune Tellers

Buskers Yogainstructors Gardeners Personalcoaches

Senior carers/Nannies Chiropractors Webdevelopers/Coders Bitcoinminers

SomeExamplesofFreelancers

Structuralshiftsshapinganewworldofwork

Combinedforces• Globalisation• Fasterlifestyles• Technologicalrevolution• Demographicchanges• Increasedmobility• Developmentoftheservicesector• Newproductionpatterns• Onlineplatforms• Erodingbrandandemployerloyalties• Needforspecialisedadhocskills• Costeffectiveonlineadvertising• Accesstobetterinfrastructures

Workisnowadays…1. Muchmoreaccessible2. Inmuchsmallerpieces3. Fromagreaternumberofproviders4. Unbundledfromajob

NickGrossman,TheUnbundlingoftheJob

• Definefreelancersasauniquesubsetofmicro-enterprisesforthepurposeoftheSMEsdefinition.

• Obtainbetterdataonthefreelanceworkforcethroughnewandmoreregulargovernmentsurveys,withup-to-datecategoriesandcriteria.

• Modernizethesafetynetwithaportablesystemofbenefitstiedtoworkers,nottoasingleemployer.

• Producesimplifiedpolicythatconsidersfreelancers,withimpactassessmentsadaptedtoself-employment.

• Createtherightincentivesandensurefreelancerscanaccesswork,publicprocurement,credit,socialsecurity,training,infrastructuresandtaxbenefitsatthesameconditionsofemployees.

Recommendations:PolicyMakers

• Developflexiblepensionproducts whichfreelancerscanaccess,withoutpenalty,whenfacedwithincomevolatility.

• Developaffordableincomeprotectioninsuranceoptions forfreelancers.

• Createasavingschemeforfreelanceswheretheycanchannelapercentageofeveryinvoice.

• Buildmoresharedofficesthatcanbebookedinincrementsandcoworking spaces.

• Developflexibletrainingprogramstoenablefreelancers toadvancetheircareers.

Recommendations:Intermediaries

• Understandlifetimeemploymentislargelyarelicofthepast.

• Operatelikeaself-containedsmallbusiness.

• Mapoutyourowncareertrajectories,lookingforyourownadvancement.

• Developdifferentiatedskillstoavoidbecomingpartofalow-wagegeneralistpool.

• Learnself-managementskillsandforesighttoprepareforhighsandlowsinearnings.

Recommendations:Workers

• Don’tthinkintermsofemployeesbutintermsofspecialisms.

• Createanexternal talentpooland appointanofficerofextendedworkforcemanagement.

• Deviceanalyticstomeasureperformanceandintegratefreelancersintothecompanyculture.

• Peoplespecializing indoingwhattheydobestraisestheirengagementandmakescompaniesmoreproductive.

• Considerthetrade-offs,itcanbeunwisetomanagesomeone’sworkexternallyandriskiertoentrustsomeonewithconfidentialprojects.

• Ensurethatindependentworkersaretreatedfairlyandethically.

Recommendations:Companies

AdaptedfromPeck,TheFlexibleFirm(1996)

“Therearelawsforpeopleandlawsforbusinesses,butweareanewcategory,athirdcategory…peopleasbusinesses.”

- BrianChesky, CEOAirbnb

“Myfatherhadonejobinhislife,I'vehadsixinmine,mykidswillhavesixatthesametime.”

- RobinChase, CEOZipcar

MarcoTorregrossaabout.me/marcotorregrossa

SecretaryGeneralEuropeanForumofIndependentProfessionals

@EFIPUpdate | #iPros | #ThinkSmallestFirst

UnderstandingIndependentProfessionalsintheEU,Lorence NyeandKayteJenkins,June2016.FreelancinginAmerica,FreelancersUnionandUpwork report,2015.Howdothestaffingneedsofcompaniesevolve?,DenisPennelCiettManagingDirectorpresentationatILOITC,2ndNovember2015.TheFutureofWork:SkillsandResilienceforaWorldofChange,EuropeanPoliticalStrategyCentre,10June2016.FutureofWorkWhitePaper,WorldEmploymentConfederation,September2016.Independentwork:Choice,necessity,andthegigeconomy,McKinseyGlobalReport,October2016.Illustrations,byIgorKalashnikov for BrightSide.me

Sources