Executive Strategy

Who's Driving Change

Who's Driving Change

Dane Flanigan Rise of the Independent Contractor.JPG

Employee: “I found a higher paying job; here is my two weeks’ notice.”

Employer: “We found a cheaper version of you; here is your severance package.”

Is it time for employees to think outside the box and for employers to adapt to the new American worker?

The term employee has always carried a sense of stability, a paycheck, benefits and, if you are lucky, a 401(k). While there is a ton of other factors that push companies to grow productivity, some equate growth to cutting costs. And the most controllable cost in any organization is human resources. As a consequence, American companies have moved to lower cost markets from the West, the Midwest, to the South and now international.  

Why would employers hire employees rather than individual contractors? Job loyalty is important and so is training and development. 

Why would employees favor a contract over full-time employment? Flexibility. You can design your own hours and maybe get higher pay. Why full-time employment? The bennies – benefits that are given by an employer because you are insured with a larger number of people. It may also be for job security.

Belonging and security are both usurped by the market. If your company is not doing well, then they may need to lay you off. If the market determines that people with your skill set should be making a higher wage, you could move to another company.   

My Uber driver today could have easily had been my Lyft driver— he carried both decals on his car. The electrician on the retail building may be same electrician on the apartment tonight. The barista this morning could be the waiter this afternoon. The job descriptions in the real estate and hospitality industries have always flowed in accordance with their markets. The same goes for IT and medicine. If these industries have been able to adapt to market conditions, why can’t others?

The difference is in the way these people utilize and capitalize on their skills. Flexibility is everything in the open market. The power is held both by the employee and the employer — it’s on-demand. While we do not want to understate labor laws, unions or corporate culture—all of which are significant— let’s also not overstate the obvious: cost. Just because something is expensive doesn’t mean you run from it or move; we have to look at other alternatives.

Can we look at better ways of attracting and keeping employees? Flexibility is key.

By Dane Flanigan

Dane Flanigan is a business consultant who helps companies build strategies to grow sales.