Reimagine: Freelancing and the Gig Economy

I’m continuing my series on flexible work this week by talking about freelancing and the gig economy. 

These types of work continue to play a huge role in a growing number of industries, but how beneficial is freelancing – both for workers and employers?

Hint: I think a reliance on freelancing to any significant degree to achieve needed flexibility is risky for employees, employers, and our economy. 

Read on to learn why, when this type of work might be the right choice, and how we can reduce reliance on gig work in our economy.

The ability to work remotely has grown exponentially in the past 15 years. Internet access and collaboration software have given people the ability to do many types of jobs from anywhere, any time. 

Sounds great, right? For many, it is! 

But the downsides of the gig economy reveal some real cracks in how we work. 

Because we’ve set up our economy to be so reliant on employers to meet essential needs like healthcare, parental leave, and retirement savings, people working outside of traditional employment arrangements are often left without any kind of safety net.

(Maybe corporations shouldn’t provide essential public services, but that’s a topic for another newsletter!)

Freelancing and gig work do offer some real benefits for employers. An organization can:

• access specialized skills for projects when they might not need those employees year-round 

• reduce costs, saving on overhead by paying per project and offering flexibility to expand or contract services based on need 

And there are benefits for workers too:

• freelancing can provide a level of flexibility and autonomy rarely found through full-time employment. (But see my last newsletter about why and how that should change!) 

• Some freelancers also see increased income potential by working on a contract basis instead of with a salary

And what about the risks? The risks to workers are pretty clear:

• lack of security 

• the need to overwork to make ends meet, and 

• the lack of a safety net in the form of health insurance and retirement savings 

Less talked about are the risks to organizations. Relying too heavily on freelancers can 

• cause you to lose institutional knowledge, an understanding of work and communication styles 

• risk quality control when you’re not working with the same team consistently

• place a heavier burden on managers who have to communicate and coordinate with new freelancers on each project instead of relying on a team that has established trust and mutuality

• legal concerns, as contractors are treated legally differently than salaried employees 

In an economy where many people do want to freelance, and employers often benefit from employing freelancers, how do we reimagine freelancing to minimize these risks? 

As long as we continue to rely on employment to provide public services like healthcare and paid leave, freelancers will have to weigh the costs and benefits of working independently. 

Freelancers and contractors can take steps to enhance their own financial security with thoughtful financial management that prioritizes savings to help weather drier periods. Similar to seasonal work, the ebb and flow of contract work points to living under your means in flush times so you’re not strapped when there’s an ebb. 

Organizations who choose to utilize freelancers can minimize the potential downsides by prioritizing support for managers of freelancers, investing in knowledge management tools, and putting robust quality control processes in place. They also shouldn’t neglect investing in legal services to ensure legal requirements are met when employing 1099 contractors. 

Some hopes for the future:

• organizations could offer some of the flexibility that makes freelancing attractive while still providing the security of traditional employment

• The government provides more robust social services so corporations and organizations aren’t assumed to be responsible for things like healthcare, retirement savings, parental leave, etc. 

Freelancing will be a part of our work world, so make sure you do everything you can to ensure success and stability for both organizations and the freelancers they employ.

Working Well/Living Well

MatchPace’s ethos is that we need to be able to work and live well. “Well” doesn’t always mean rosy or positive. Instead, it reflects the reality of doing good work! And the same is true for living well. Sharing each week how I’m living well reminds me I’m a whole person, with a full identity outside of work. 

Working Well: this past week has been all about the proposal I mentioned last week. Lots of drafting, re-writing, meeting with colleagues, etc. I love getting to work with new clients, but the proposal process… is a little much! 

Living Well: because I was so underwater with work, Andy basically did all the parenting for the past 10 days. Including taking the kids on a road trip to NC to see their grandmother! They played pickleball, got to spend time as newscasters, and enjoyed time with cousins! 

Follow me on LinkedIn for more insight about reimagining how we work and live!