Survey shows shift away from traditional employment “larger than previously recognized.”

Overall, we estimate that the independent workforce is larger than previously recognized: some 20 to 30 percent of the working-age population in the United States and the EU-15 countries are engaged in some form of independent earning today. More than half of them use independent work to supplement their income rather than earning their primary living from it. The majority of independent workers, both supplemental and primary earners, pursue this path out of preference rather than necessity—and they report being highly satisfied with their work lives.

This from the executive summary of a just issued survey by McKinsey Global Research illustrates the erosion of the traditional concept of employment, anchored by what author Dave Rolston described in his 2013 eBook Four Dead Kings at Work as the crumbling pillars of the traditional notion of working for a living: holding one job, located at one place, being there at the same time every day and reporting to a single manager.

As I wrote in my own eBook Last Rush Hour: The Decentralization of Knowledge Work in the Twenty-First Century, a driving factor is the decentralization of knowledge work due to the proliferation and maturation of information and communications technology. Before, knowledge workers had to work in a single location – a commute-in office – because that’s where the tools they needed to do their work – typewriters, telephones, photocopiers, in-house central computer systems – were. Even though obsoleted, this outdated model remains in place and continues to define employment. If you don’t commute to an office to work 8-5, Monday through Friday, you’re not in the traditional employment arrangement. Or “trapped in a cubicle” as the McKinsey Global Research report put it in the introduction.

We’re currently in a transition between this Industrial Age model of knowledge work that pays for time worked to one based on work projects and milestones completed. Time worked is fundamental to the legal definition of employment in the United States that keeps the Industrial Age model largely in place. It’s one of Rolston’s dying kings: one timeframe (8 hours a day, 40 hours a week) along with working in set office location for a single manager. But it won’t go away quickly as the tension between the old and the emerging models plays out.

2 thoughts on “Survey shows shift away from traditional employment “larger than previously recognized.”

  1. Frederick, a great topic. You might also like to review Steven Hill’s Book, Raw Deal, as he captures some interesting information on the conversion of the workforce from W2’s to 1099’s to “the sharing economy’. We sometimes like to view the ‘freeing nature of information technologies’ but it may also be viewed as a convenient, if not somewhat deliberate, shift of the employer/employee relationship to that of contract labor. This transition suggests we need to more fully understand the ‘social contract’ arrangement of the former versus the absense of social contract’ obligations of the latter.

  2. Michael:

    The McKinsey report recognizes economic challenges with the shift to independent work. See heading “Independent Work Could Create Economic Benefits But Challenges Need To Be Addressed” and discussion starting on p. 14 of the full report.

    The key is independent work needs to provide a sufficiently robust degree of economic opportunity and income security as employment traditionally has done. People and particularly those with strong professional experience should be able to work independently by choice on a sustained basis and not be forced onto the employment market to earn a living. As the report also notes, benefits that have typically been linked to employment (retirement, health) must be decoupled from employment and accessible and affordable for those who choose to work independently.

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