The Shifting American Workforce: Growing Legions of Freelancers and Independent Contractors

Anyone paying attention to recent employment statistics and trends understands that a substantial amount of the U.S. workforce is comprised of contract workers and freelancers. Due to a variety of socioeconomic factors, our country’s reliance on independent workers has taken a substantial shift upward. Statistics published in Fortune Magazine place the freelance population at over 42 million individuals. What’s even more astonishing is that some entrepreneurs speculate that the freelance population will quickly overtake traditional employees by 2020, as described by Gene Zaino, the CEO of MBO Partners.

Generational Differences

The freelance phenomenon may possibly be a result of shifting career attitudes held by younger generations. According to the Millennial Generation Research Review released by the U.S. Chamber of Commerce, this age group has “witnessed instability in the workplace… and their parents’ jobs being downsized after years of service.” The review describes how nearly a third of this generation has become self-employed. It hardly seems surprising, since those born between the years of 1980 through 2000 distinctly remember the Great Recession that began in 2008. It’s possible that this age group is more likely to pursue freelance work because of career disillusionment carried over by hardships suffered by their parents and their own initial efforts to find traditional employment.

Statistical Gaps

As the freelance population continues to grow, it’s become increasingly apparent that the federal government hasn’t been keeping track of this vital, yet often overlooked workforce. According to a Reuters op-ed by Sara Horowitz, independent workers haven’t been included in Bureau of Labor Statistics data, which can significantly skew current employment and unemployment statistics. It can be difficult to get a handle on just how many freelancers there are in the U.S., since these work categories can span virtually all industries. For example, the IRS describes independent contractors as a myriad workforce of physicians and dentists (presumably with their own practices), lawyers, and those who earn money performing professional services as an independent trade. With this degree of variability, it’s hard to pinpoint just how much of the current workforce falls outside the scope of traditional employment.

Increased Mobility

Perhaps one of the biggest work environment shifts that factors into the freelance explosion is the flexibility and mobility of current technologies. Businesses no longer need to rely on in-house work to complete projects. There is lower overhead and hassle associated with independent workers and freelancers. This untethered workforce is free to work from anywhere they can find an Internet connection. Many distinguish themselves with the digital nomad moniker, relishing in the ability to travel and work from anywhere at anytime. These workers have truly embraced the power of new media and collaborative online platforms. Cloud computing and document sharing systems have made it possible for companies to deploy work to countless remote freelancers.

The modern American career landscape is changing quickly. Businesses and the federal government are struggling to keep up with shifting work attitudes and productivity styles. The growth of the freelance and independent contractor workforce during the next decade may usher in all new legislation, benefit considerations, and technologies.