Why Workers Will Be Happy

Individual workers can see lots of upside in this new world. Workers may find that to a far greater extent than in the past they will get to work on what they want, when they want, and where they want. This freedom could lead to a far higher quality of life. Some workers who were shut out of the employment market because they live in the wrong country or are unable to leave the home for long periods may find the world beyond employment to be a lifesaver. And rewards could be far more aligned to the unique needs of individual workers versus the homogenous, often inflexible, rewards typically received by employees.

Why Organizations Will Be Happy

For organizations, the beyond employment world looks delicious. The organization gets to access all the talent they need at the right price and only for the period of time they need. Organizations should be able to focus on what they truly do best and move the rest outside the organizational boundary.

Why Economists Will Be Happy

For economists, the beyond employment world looks efficient. While they will have some areas of concern, such as the amount of labor poured into a particular competition and the potential knock-on consequences for the rest of the economy, they will likely see the new world as a place where talent and work are matched far more efficiently than in the past.

Why Nations Will Be Happy

If workers, organizations, and economists are happy, then nations should be happy too. It is true that developing countries have more to gain from dispersed work than wealthy countries, but it is hard to argue that helping close the income gap between the old world and the developing one is really a bad thing.

In this scenario, the world beyond employment is the best thing ever.

Why Workers Will Be Concerned

The average MTurk task pays less than $2 per hour, which adds up to less than $4,000 per year for full-time work.¹ If that's the future of employment, then workers have a right to be worried. There is widespread concern that moving work outside employment is simply a means for escaping laws on minimum wage, liability, safety, and security.

The issue of income security is one that bedevils even successful free agents. A free agent never knows from month to month how much they will make or when the work will appear. There is a continual fear that one day the work will, without warning, dry up. Employees can lose their jobs too, but it doesn't happen quite as often and at least they get severance.

The concerns of low-skill workers will be somewhat different from high-skill workers, and the concerns of on-premises workers will be somewhat different from virtual workers. However, we can still list three broad categories of threats that worry all free agents to some extent:

1. Dramatic drops in hourly wage. There is no minimum wage for free agents, and in particular if people face competition from workers in poor nations they may find their hourly wage is much lower than it was in the past.
2. Insufficient volume of work. For many free agents, the hourly rate is less of a concern than the inability to get enough work. This can be especially true if you need to compete for work via contests that you only occasionally win. For on-premises part-time workers, the commute time may dramatically cut into the time available to do paid work.
3. Income insecurity. Even if a free agent is doing well, there's the constant fear that next week could be a bad one. Free agents may be hesitant to plan for time with family or holidays because they feel a need to always be on call for potential clients. Some landlords in the UK won't rent to people on zero-hour contracts because they see them as high risk.²

Why Organizations Will Be Concerned

Organizations may find the turbulence of the world beyond employment undermining their ability to operate. Some may go too fast or too far, and inadvertently cut some of the essential rigging that holds the organization together. Others won't move fast enough and get caught with unsustainable overheads. Perhaps everyone will spend a fortune trying to adapt to change and build more agile and nimble organizations instead of serving their customers and improving their products.

Furthermore, social concerns are business concerns, too. If people cannot earn a decent living in free agent world, then that will be bad for business as their ability to spend money on goods and services will be diminished.

Why Economists Will Be Concerned

Thoughtful economists can imagine all kinds of situations where the changing approach to work leads to inefficient outcomes. If free agents spend most of their time competing for work, and only a little time actually doing the work, that's not an efficient use of talent for the economy. If 11 designers create 60 webpage designs and only one gets paid $600 (a real example), is that not at least 90 percent waste?

There is also the risk that a world beyond employment will amplify the winner-takes-all economy where there are a few winners and many losers, and that will lead to an even more unequal distribution of wealth. In his popular book Capital in the Twenty-First Century, French economist Thomas Piketty argues that unequal distribution of wealth causes social and economic instability.³

Why Nations Will Be Concerned

In the book Rebooting Work, Maynard Webb writes about the virtue of being the CEO of our own destiny, and how he worked his way up from a job as a security guard to be the CEO of the cloud-based contact center LiveOps.⁴ It's a great story, but should it interest a government policy maker? A policy maker knows that a small percentage of people will always succeed regardless of the obstacles they face. However, governments need to address the risk that a significant percentage of the population will not have the capability to thrive in a free agent world.

Furthermore, there is the risk that dispersing work will move a lot of it to low-cost markets. According to PayScale.com, the median salary for a civil engineer in Indonesia in 2015 was around $5,000. If that becomes the going rate then developed countries will have to deal with a lot of unemployed engineers.

Nations have leaned heavily on labor legislation to create a good life for their citizens. That legislation is now being outflanked as work is being sent to the people, instead of people coming to the work. Nations are right to be concerned about how disruptive the beyond employment world may be, leaving governments to pick up the pieces. In the words of Gary Swart, former CEO of oDesk, “There are very few laws about bringing work to the worker as opposed to the worker to the work.”

What Nations Can Do

There is an entrenched school of thought that the free agent world is all about employers exploiting workers and that it should be stopped. It's seen primarily as a way for employers to skip out on their obligations to employees. Those who believe this view call for governments to crack down on these new practices and draw everyone back into the familiar world of employment.

This is far too simple a way to frame or respond to the issue. Yes, sometimes free agent world leads to exploitation, but often it can serve the free agent well, and often it's a more effective way to get work done. Furthermore the vision of a world where everyone is employed in secure, well-paid, full-time jobs is a myth even in rich countries with strong labor laws. Countries like France do a good job of protecting employees; however, this protection has created a two-tier world with some people in secure work and others in precarious work or unemployed. Besides, readers of the Dilbert comic will know that the traditional office is hardly a paradise of human happiness.

We might think back to the industrial revolution, where the invention of the factory led to dangerous and unpleasant conditions for workers. Governments could have tried to ban factories and draw workers back to the familiar world of farms and crafts. But the actual outcome was better than that. Governments came to recognize the harms that arose from industrial work and addressed them, creating extensive legislation and institutions to deal with the following issues:

• Unsafe working conditions
• Unfair wages
• Unduly long work hours
• Unfair time-off policies
• Arbitrary dismissal
• Discrimination

Rather than try to suppress free-agent work and rely on existing law and institutions, nations need to update those laws and institutions so that they address the problems arising out of this new world of work.

Here is some specific advice:

• Get good data. Is MTurk underpaying workers, or does it provide a niche for hobby work for people who are otherwise idle? Is the precariousness of the competition system on Tongal and Topcoder hurting workers or are the vast majority doing okay? What actually are the biggest problems facing workers today? Without good data, we can't make good policy decisions, so the first step for governments and civil society is to improve the ability to gather and analyze data on the new world of work. With good data, we can identify just what harms need to be addressed. Interestingly, many of the problems addressed by existing labor laws may be less important in free agent world. Certainly, issues like unduly long work hours, unfair time-off policies, and arbitrary dismissal seem moot for free agents who make the decisions about what work to do and when to work. Unsafe working conditions and discrimination are less likely to be problems when so much work is virtual and often done at the free agent's location of choice. Maybe TaskRabbits do need to unionize and we may need to make that easier to do, but we won't know without good data.
• Be bold, be inventive. Our existing laws and institutions arose because of a willingness to be bold and inventive. Perhaps we need a guaranteed minimum income (e.g., a living wage); perhaps the state should act as an employer of last resort; perhaps we need to reform taxation; maybe we need to promote cooperatives over corporations—let's test some new initiatives to see how they work. No major government initiative is without downsides; however, government initiatives have led to excellent train networks in Europe, moon landings by the United States, and efficient health care in France. So let's not discount the ability of nations to find means for adapting to a world where employment is not the norm.

We should also remember that there is more to a nation than government. The U.S. Freelancers Union helps address many problems freelancers face, and Turkopticon helps warn Turkers about exploitive companies. We should look to civil society to identify and address problems that arise in the new world of work.

One of the main limitations of government action is that it tends to operate at a national level. If workers win protections in one nation, what is to prevent companies from simply moving work to some other country? Countries that have tried to rein in risk-taking behavior in the financial services industry know how hard it is to act individually. Sweden introduced a tax on equities trading in 1984, and by 1990 more than half of all Swedish trading had been moved to London. In 1991, Sweden abandoned the tax.

While global collective action is not easy, there are many global institutions that address global problems. Global health institutions eliminated smallpox, and global collaboration among banks makes it possible for you to withdraw cash from your account even when you are standing at an ATM in Borneo.

There is much skepticism regarding the ability of global institutions to be effective and to address the interests of the average citizen as opposed to special interests. This skepticism is well founded. However, if we choose to live in a global economy, then there's no avoiding the need for global institutions and global collective action. It's not so much a question of acting or not acting globally, it's a question of how do we get better at dealing with issues that extend beyond the boundaries of the nation state.

What Organizations Can Do

Organizations should recognize that they have a duty to their workers whether those workers are employees or not. In fact, legal scholar Lynn Stout has shown that even profit-making corporations need not put shareholder interests ahead of the well-being of workers.⁹ Organizations need to break down the mental walls that treat employees as “talent” and free agents as “widgets.” All workers are people, and organizations should be concerned with the well-being of all their workers.

What We Can Do on Our Own

Probably the most important thing an individual can do is avoid clinging to the idea that success is about getting a traditional job. That option may still exist in the future, however, it may be that the best or only work available is for free agents. Simply seeing the world in this way should motivate you to start developing the skills and knowledge necessary to succeed as a free agent. This means adopting a mind-set of continuous learning and skills acquisition to ensure your continued relevance.

Financially, the life of a free agent can be fraught with uncertainty. There simply is no guarantee of making money week to week or month to month. Risk expert Nicholas Nassim Taleb argues that this model is not so bad, that it is actually “antifragile.”¹⁰ It may feel insecure to be constantly searching for work, but Taleb argues that this helps us continually adapt to a turbulent world. A free agent may go through a dry spell, but she is unlikely to lose all her revenue streams and is in a good position to adapt and find new work. In contrast, an employee who loses his job loses all his income and may find himself with outdated skills and no ability to find new work.

A free agent has to embrace income volatility as a fact of life, and in the absence of a secure stream of income, will be wise to avoid debt even if it means delaying gratification. Some old notions about the merit of saving money and being frugal seem all the more relevant for a free agent's life. Lots of people do live good lives as free agents, and lots more may need to learn from their example.

What Your Kids Can Do

“Kid, let me show you the ropes.” That's a phrase you won't hear much in a world beyond employment. One of the most valuable purposes of traditional employment in traditional organizations is that it can take a young person with no particular skills and turn them into a skilled, productive individual. They might even cost more than they are worth for the first year or so, but that's okay, because they're the young plants you nurture. What is the equivalent in the free agent world? Kids need to seek out coaches and mentors to help them develop the skills to thrive in a free agent world. In today's world it is easier than ever to connect to people with the expertise you need so there is no excuse for not reaching out. There are even talent platforms to help you access the right mentors.

Free agents have to be skilled at technology, sales, marketing, and self-development. Kids need to accept this as a reality and recognize that mastering some specific discipline (whether that be English or Engineering) is only one part of what they will need to thrive. If schools do not help kids get the free-agent skills they need, then they need to get that education elsewhere. There are endless sources of help online; and kids need to understand they need to go out and find them.

The next generation will have to ponder if it is better to pay to get an undergraduate degree or spend those four years learning how to navigate the talent platforms. A kid out of high school can't expect to earn much on a talent platform when starting out. But after four years, she will probably have gotten quite skilled at acquiring work and won't be sitting on a pile of student debt. Imagine groups of young people connected via Internet chat, playing the talent platform world much like they play team-based video games like Call of Duty. In the world of work, they will “level up” as they develop new skills, a stronger portfolio, and a better brand.

Another great opportunity for the next generation is to use the myriad of talent platforms to explore the enormous variety of work in the world. Children say they want to be a teacher or a pirate, not because these are the best jobs, but because those are the only jobs they know. A young man in Texas would never have known how lucrative playing with Legos could be had he not discovered the world of Lego-based commercials through Tongal. Young people have the most to gain, and the least to lose, from embracing free agent world.

The main thing for kids to recognize is that they may never get, nor need, a regular job. Sure, many will end up employed, but everyone should embrace being CEO of Me; whatever that means to them. Let's stop grooming kids for a world that won't exist.