As the pandemic continues, many companies are likely to reduce their reliance on full-time employees and increase their use of flexible talent, such as freelancers, temps and part-timers—just as in the last recession. “You’re going to see a lot more companies turning to contractors,” says Gene Zaino, chairman and founder of MBO Partners, a provider of back-office services to the self-employed that studies independent workers.
“Non-employee” labor already made up 43% of the workforce in 2020, according to a report by Ardent Partners. And 77% of executives predicted that contingent and freelance workers will replace traditional employees substantially in the next five years, according to Mercer’s 2020 Global Talent Trends Study.
Even in a recession, talented independent professionals have options. That means employers will need to raise their game in courting them, according to the recent Client of Choice report by MBO Partners.
“These people have choices,” says Zaino. “They have figured out how to run their own business. They are focused on the type of work they would like to do and whom they would like to do it with.”
The report examines the motivations and drivers for the 7.6 million independent professionals who work full-time providing professional services to corporations on a contract basis. These B2B professionals are working in highly-skilled fields like engineering, IT, management consulting, marketing and R&D. Since 2011, their number has risen from 4.5 million, the report finds. The data is based on a 2019 survey of nearly 4,000 U.S. residents ages 21 and older and 31 human resources and procurement professionals.
Despite the growing reliance on freelancers many firms don’t know how to engage them , with some onboarding them through procurement departments that are more skilled in buying things than attracting and retaining talent. “Engagement is the new channel,” says Zaino.
So what are these expert freelancers seeking when they take on a client?
· 98% say control over their work is very important or important
· 95% say it is important or very important that clients value their work
· 94% say having quick payment terms is important or very important
· 91% say having control over their schedule is important or very important
· 90% say being treated as part of the team is either very important or important
· 95% say that letting them work on tasks they enjoy doing is very important.
· 86% say being paid well is important or very important
· 84% say finding work assignments that let them grow professionally is very important or important.
There are 41 million Americans who do freelancing, independent work, contracting or other types of independent businesses, but many are part-time, the report finds.
The 7.6 million full-timers surveyed have a specific profile. They skew male, with men making up 61%; and they have an average age of 49, older than the 41-year-old average for all independents.
They’re also highly educated. 71% have four years of college education or more, higher than the 39% for all independents and the 34% for all American adults—and 30% have graduate degrees.
They don’t stop their education after earning their degrees. With 89% saying learning new skills is important or very important to their careers, 61% said they had participated in skills development over the past year.
They are also well-compensated. In 2019, the highly skilled independents had an average income of just over $ 76,000, and many earn more than $ 100,000.
They are in it for the long term. The average highly skilled independent had worked independently for 9.5 years, and was working for 4 to 6 clients at a time, for an average of 3.6 years.
Among these respondents, 79% plan to continue for the long term, and 74% are optimistic about the future of their careers. 59% said they would not choose to go back to work at a traditional job, and just 21% were reluctant freelancers who would prefer a traditional job.
And they are choosy about clients. Among those who make $ 100,000 or more per year, 64% said they have a lot of choice in picking clients, and 29% said they have some choice. 86% said they are very satisfied or satisfied with their current clients.
Why do they make a living this way? Their top reasons are desire to control their schedule (68%), greater work/life flexibility (61%), and being able to work on projects they like (40%). Other reasons include the desire to pursue a passion or interest (36%) and to build their own business (34%).
Many seem to be finding what they want, with 89% saying they are either highly satisfied or satisfied with their path, and 83% saying they are happier working on their own than a full-time job.
And fortunately for them, many have the business savvy to keep their careers going, even in challenging times. “They know what it is to go and find work,” says Zaino. “They know how to work around obstacles. They make things happen.”