The freelance economy and variable workforce models have been gaining traction in a wide array of markets. Although the demand for this type of labor is growing, there are segments of the field-service industry that are concerned about whether or not individuals will continue to choose freelance work over full-time employment. We can answer this question by examining some factors affecting supply and demand. The first is the nature of work itself. The field-service industry, like many industries, has undergone a major shift in the way work is performed and by whom. This shift began in the late 1990s and early 2000s as the trend toward outsourcing forced many high tech companies (e.g., OEMs, resellers, integrators, etc.) to consider whether owning a field service force was strategic to their businesses. As a result, a number of companies began to outsource their field service activities.
The next major shift had to do with inversion of organizational hierarchies. In the past, span of control and layers of management were a proxy for expertise in the field-service industry. In other words, the larger the company, the more layers of management – and the more organizational controls in place, the better the service was perceived to be. Companies now realize that that large outsourcing providers are not only more costly do deal with but often do not possess the right level of technical expertise to complete the work accurately and in a timely manner. To overcome these deficiencies, companies that outsource or out-task field service now prefer to cut out the “middle man” and deal directly with individual expertise (e.g., freelancers) as needed.
A more recent shift that has made freelance work possible has to do with advances in communication and collaboration technology. These technologies make it easier for companies to do business with anyone, anywhere in the world without the need for large infrastructure or supervisory personnel. The Great Recession of the late 2000s also shifted the nature of work as many laid-off workers were able to generate income for themselves by taking on freelance assignments. This in has turn led to the emergence of the “Sharing Economy” also known as the “Gig Economy” where individuals are finding personal freedom and fulfillment from engaging in freelance work made possible through Freelancer Management System (FMS) platforms.
However, many economists wonder what will happen to the Gig Economy when economic growth improves and companies need to hire full-time employees. According to the U.S. Bureau of Labor Statistics over 34% of the U.S. labor force is performing freelance and independent contracting work. However, this number is likely to reach 40% by the end of this decade.
This trend is further supported by a market research study conducted by Field Nation, a leading FMS platform provider to the field-service industry. Their study reveals five (5) critical insights about individual preferences for freelance work. First, an overwhelming majority (88%) of respondents indicated that the freelance lifestyle is a personal choice for them. Second, almost three-quarters (73%) indicated that freelancing is their primary source of income. Third, over one-half (52%) view themselves as entrepreneurs and small business owners. Fourth, 93% of the respondents are committed to their clients’ success in addition to their own. Fifth, almost all (97%) are satisfied with what they do on a day-to-day basis, and 95% are either satisfied or very satisfied with their career choice as a freelance contractor. These stylistic facts suggest that the days of individual commitment to a single employer are long gone. The freelance economy is here to stay!
To learn more, download your FREE copy today of my whitepaper titled “The Variable Workforce Model – An Optimal Solution for dealing with Field Service Uncertainties”.