Over the past year, both supply and demand for independent workers increased. MBO Partners’ latest State of Independence Study found that 72.1 million Americans reported working independently in 2023. A tight labor market and demand for workers with specialized skills led more organizations to rely on independent talent to fill skill gaps. Together, this increased supply and demand for independent workers was supported by technology that help talent and companies to connect with one another. Here are four trends driving the growth of the independent workforce.
1. Workers Want Autonomy and Flexibility
What drives people to independent work? One of the biggest factors is the lifestyle it provides. Independents enjoy being their own boss and being in control of the work they do and choose to take on. These attributes take priority over making money for most workers: 70% say doing something they like, and flexibility are more important than making the most money.
Most independents—77%—say they are very satisfied with independent work and 78% say they plan on continuing to work independently or build a bigger business. The majority of these workers choose to be independent, as opposed to turning to independent work for factors outside of their control, so they are able to have a fair amount of control when it comes to picking the clients they work with.
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2. Companies are Increasing Their Use of Independent Talent
More companies than ever before are engaging independent talent as they are faced with disruption, competition, and labor and skills shortages. Independents can offer enterprises valuable flexibility in hiring. They bring a set of specialized skills to the table, which hiring managers can use to build out a project team. Independents also don’t require the same investment in training and retention than a full-time employee. These benefits help organizations lower the cost of employment while remaining agile among their competitors.
In 2022, the average company reported that contingent labor made up 28% of their workforce. These companies expected this percentage to increase to 38% by the end of 2027. Even more interestingly, 82% of organizations surveyed said they are taking steps to improve how the integrate and manage independent workers as part of their workforces.
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3. More People are Pursuing Side Gigs
A third reason the independent workforce is growing is due to the fact that more people are pursuing side gigs. The number of people working occasionally as independents increased 130% over three years from 15.8 million in 2020 to 36.6 million in 2023. Working a side gig has become more common and accepted as a way to bolster income or test out a passion business before pursuing independence full-time.
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4. Technology is Empowering Independents and Enterprises
Lastly, technology has played a large role in empowering people to work independently and giving enterprises the confidence to engage these workers. In 2023, almost one-quarter of independents said online talent marketplaces were a top three method of finding work. And 40% of independents who provide services to businesses said they used a platform to find work in the past 12 months. These online platforms allow independents to create a profile highlighting their skills and experience. Hiring manages can review candidate profiles, invite independents to apply for a role, or allow the platform to use an algorithm to match profiles with projects.
Other technology has helped give independents the power to run their businesses more smoothly and successfully. Automation software, for example, can assist with project management and taxes, while online collaboration tools like Zoom, Microsoft Teams, and Slack help facilitate more streamlined communication between independents and their clients.
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As the independent workforce continues to grow and evolve, so will the four trends that shape it. Staying in-tune with what independent workers want, watching how organizations adapt to better accommodate independent talent, seeing how side gigs grow and evolve, and observing the advancement of technology in this sector will provide valuable insight to the future of the independent workforce
For more insights and detailed data, visit https://www.mbopartners.com/state-of-independence/