Freelanced: The Rise Of The Contract Workforce
Freelanced: The Rise Of The Contract Workforce
A new NPR/Marist poll finds that 1 in 5 jobs in America is held by a worker under contract. Within a decade, contractors and freelancers could make up half of the American workforce. Workers across all industries and at all professional levels will be touched by the movement toward independent work — one without the constraints, or benefits, of full-time employment. Policymakers are just starting to talk about the implications.
In a weeklong series, NPR will explore many aspects of this change.
In an old metal-stamping factory that was once part of Wheeling, W.Va.'s industrial past, a law firm has set up a futuristic model for how to get legal work done. Unlike the old factory, it relies heavily on new kinds of work arrangements.
"Contractors are hired by the hour," says Daryl Shetterly, director of the Orrick firm's analytics division. "So we might have 30 people working today, and tomorrow we might have 80."
Tenure for workers in the building used to be measured in decades. Now it might last a few days for the workers there today. While the building has had a facelift, Shetterly says, "it is a factory in that we work to drive efficiency and discipline into every mouse click."
NPR/Marist Poll Highlights
- 20 percent of all American workers are contract workers hired to work on a specific project or for a fixed period of time.
- 51 percent of contract workers don't receive benefits from their jobs.
- 49 percent of contract workers have income that varies from month to month or seasonally.
- 65 percent of contract workers are male and 62 percent are under 45.
- 66 percent of part-time workers prefer that kind of schedule.
- 56 percent of workers received a raise in the past year.
- 84 percent of workers are not worried that they will lose their job in the next year.
- 54 percent of workers think it would be difficult to relocate for a better job.
Source: NPR/Marist poll of 1,267 adults conducted Dec. 4-7, 2017. "Workers" includes 794 adults who are employed full or part time or are self-employed. The margin of error is +/- 3.5 percentage points.
The division is a kind of processing center, using artificial intelligence tools and cheaper lawyers to speed up the handling of routine tasks, such as sorting and tagging documents. That frees other lawyers to focus on more high-end work.
It's emblematic of the kind of contract work expanding into every corner of the economy. Machines are siphoning off basic tasks, and temporary workers allow flexibility to size up and down. In the legal field, there are online platforms that match freelance lawyers with clients. It's like dating profiles — but with customer reviews and billing assistance.
The legal job market, in other words, is fragmenting, and with it, its workforce.
"Lots of people go into law expecting that they're headed to a secure, well-paying, intellectually satisfying, high-prestige job, and lots of those people find out that's not what they're headed to," says Gillian Hadfield, who studies legal markets at the University of Southern California.
She says the speed with which business evolves these days forces everyone — from businesses themselves to suppliers to the competition — to respond quickly. Employers need specialized expertise on demand, just not for the long term.
It's not just business driving the trend. Surveys show a large majority of freelancers are free agents by choice.
John Vensel is a contract attorney at Orrick who grew up a few miles from Wheeling, on the other side of the Pennsylvania state line. In his 20s, he was a freelance paralegal by day and a gig musician by night.
"I actually wanted to be a rock star," he says. But these days there are no edgy vestiges of a former rocker, only a 47-year-old family man cooing over cellphone photos of his children, Grace and Gabe.
In the two decades in between, Vensel worked full-time corporate jobs. But he was laid off in 2010, on the eve of his graduation from his night-school law program. He graduated with huge piles of debt, into one of the worst job markets.
"It was terrible; it was like a nuclear bomb went off," he says. "My son had just been born. ... We've been kind of recovering ever since."
For a time, Vensel commuted three hours round-trip to a full-time job in Pittsburgh. But more recently, he quit and took up contracting to stay near home in Wheeling.
"So, like my father, he's in the hospital right now which is like five minutes away, and I'm getting updates on my phone," he explains, glancing at the device. "And if I need to be there, I can be there in five minutes."
He says contract work is today's economic reality. Contracting allows employers to test workers out, he says, but he ultimately is hoping to land a full-time position, with benefits. A new NPR/Marist poll shows that 34 percent of part-time workers are looking for full-time work.
That may be increasingly difficult. Currently, 1 in 5 workers is a contract worker, the poll shows. According to economists Alan Krueger and Lawrence Katz, the percentage of people engaged in "alternative work arrangements" (freelancers, contractors, on-call workers and temp agency workers) grew from 10.1 percent in 2005 to 15.8 percent in 2015. Their report found that almost all — or 94 percent — of net jobs created from 2005 to 2015 were these sorts of impermanent jobs.
A Close Up Look At Contract Workers
A Close-Up Look At Contract Workers
Within a decade, many labor economists believe freelancers will outnumber full timers.
Vensel draws a contrast with his father, who retired after working 35 years at the Postal Service.
"He has a pension; we don't have pensions anymore," Vensel says. "It's a totally different world."
Sixty-five percent of part-time workers and a little more than half of contract workers work without benefits, according to the NPR/Marist poll.
Arun Sundararajan, a management professor at New York University and author of The Sharing Economy, says "this is the work arrangement for the future." The new normal will be freelance work. "Twenty years from now, I don't think a typical college graduate is going to expect that full-time employment is their path to building a career," Sundararajan says.
He says that will ultimately lead to many other changes, from education to social structures and public services.
A short distance from Orrick's offices, Wheeling's mayor, Glenn Elliott, is starting to think through the implications of that.
Elliott himself once worked as a contractor at a law firm and says contract work holds both great promise and great peril for the city. On the plus side, he sees more economic opportunities, if it can attract more companies like Orrick. On the other hand, he worries how this also changes the fundamental social contract between employers and workers.
"I don't think that loyalty necessarily exists between employers and their employees that used to be there," Elliott says.
Those looser ties will shift more responsibility to contract workers. They must handle saving for retirement and their health insurance on their own.
"But some people, despite their best efforts, just aren't going to be successful in doing that," Elliott says. "What's going to happen to those who fall through the cracks? Because the 1950s model of retirement and getting your pension check every year from your company is not a realistic model for a lot of people, increasingly."
The public safety net — the budgets for fire departments and social services — is already strained, he says, by the area's opioid problems, among other things. A future where fewer workers have benefits won't help.
Elliott expresses frustration with partisan battles at the state and federal level, while cities like his struggle to figure out how to plan for the future.
"It's a much broader problem than Wheeling," he says. But "as a country we need to be having a conversation, which we're not really having right now."