This is not about Jay-Z’s latest track, but on the subject of the 1099 Economy. Ring any bells? Anything? Something? Me, nothing. So I did some research.
OK, where to start? First thing. It is an American specific term. The 1099 Economy, focused around the 1099 workers or ‘1099ers’ are so named because of the IRS tax form they fill out for contract work at places like Uber and Lyft (Lyft is a peer-to-peer ridesharing app that is soon to arrive in Australia and the rest of the world), as opposed to the traditional W-2 form for full-time employment. I know what you are all thinking, an article about tax, err exciting stuff Kai?! Bare with me.
The traditional concept of employment as having a single full-time job is gradually diminishing. For example, think of the friendly Uber driver who just drove you to your next meeting might then spend some part of their week developing new printed street art themed t-shirts to sell in their Etsy shop, and the rest of their day offering creative design services via Fiverr to clients around the world (Fiverr is a global online marketplace offering tasks and services, beginning at a cost of $5 per job performed, from which it gets its name. The site is primarily used by freelancers to offer a variety of different services to customers worldwide – I had no idea).
Before I go on. The concept of the need to work more than one job is obviously nothing new, and not one we generally would want to consider (one’s enough, if we are lucky, right). There is, and will always be, a very large group of people operating in the ‘1099 Economy’ because they have no choice. Life is tough, one job is simply not enough, and there are mouths to feed.
Since the GFC, and the advent of collaborative consumption or the sharing economy, the focus has shifted to a greater proportion of the workforce and the rise of the entrepreneurial 1099ers who are moving away from a reduced supply of well-paying, full-time jobs looking to carve a niche that reflects their interests and skills. It was recently reported that there are 53 million Americans now freelancing. That’s 34% of the entire US workforce. In Europe, as in the US, self-employment or freelance work is the fastest growing segment of the workforce. Across Europe, 14% of all workers are now self-employed, and interest is growing. Last year in Australia it was reported that 30% of the Australian workforce, or 3.7 million people, undertake some sort of freelance work.
Referring to this great article on the subject of ‘1099ers’, it notes that regardless of how one classifies the 1099ers, they remain largely invisible to policy makers and to economic and workforce developers. They are seen as disrupters, the enemy (think about the stick that Airbnb users and Uber drivers having been experiencing as an example). That obviously needs to, and will eventually, change. In addition to recognising the importance of this part of the workforce, we also need to develop a more nuanced understanding of their concerns and needs.
One thing that Australia is good at, and there are great examples out there, is developing workspaces that support the 1099ers. The growth in coworking spaces is a positive and exciting trend. I know this personally as I cowork, and am fortunate enough to meet amazing 1099ers doing their own thing. It really is so invigorating.
For larger businesses, the changes are just as significant. In the future, businesses will consist of owners, talent assemblers (or Profesional Tribers – I love this futurist job title), and contract workers for everything else. Platforms will spring up that know what contractors have certain skills, what they’ve done, and whether they’re available. Contractors will get instantly matched with talent assemblers. Entire teams could be hired with the click of a button.
For all the criticisms of the 1099 Economy becoming an on-demand worker can still seem like a very attractive prospect to lots of people. Startups promise they can offer higher wages per hour while letting contractors work whenever they want. They hold out the hope of a bright, flexible future in which you are the micro-entrepreneur. It seems we are tending to believe them, and why not, life is short – if you are fortunate enough to be able to give it a go. Then do it!
Thanks for reading,