Three Eras of Work

I’ve been through three generations of work, so far, in my lifetime. The bootstrap era, the authoritarian era, and the era of free agents.

The Bootstrap Era: When I was young and jobless, seemingly talentless, and officially skill-less, my grandparents would describe the world of work: You go where they’re hiring, you do what they’re needing, you do what your boss wants, and you never bite the hand that feeds you. Those were the rules. If you got out of the military, like my Uncle, and “they were needing” computer scientists, you did that. You didn’t ask what you loved to do, you didn’t search yourself for the answer like all the morality plays of the time where the promising kid runs off to be an artist only to learn that his place was in his father’s footsteps. You asked what “they” were needing. It was never specified who “they” were, of course – “they” were the unacknowledged nexus of corporate, military, and political interests – but for my grandparents, loyalists who didn’t bite the hand that fed them in the great war, “they” were just “society” – or “the world”. If you were like me, 17 years old, your talents cast aside for the necessity of a job, any job, and when those talents surfaced – they had no explicable ‘resume’ of acceptable contexts to prove themselves, you went where “they were hiring” and “started at the bottom” and “worked your way up”. Supposedly, a job sweeping or tossing fries at a burger joint would result, with enough hard work, in a respectable position like assistant manager some day, and if ever “they were needing” managers, you might just, if you kept to the rules, become that (and get a house, wife, car, retirement plan, and all the things that give one’s life meaning). But the world *did not*, in fact, work that way. By the time that advice was given, the world had already changed. Fry cooks didn’t become managers. Managers came from a special centralized school, and needed at least a college degree. To my grandparents, college was for the well to do, the ones with trusts funds, so this just didn’t compute. Keep scrubbing those floors, and somehow loyalty will make you ascend. But the era of loyalty being rewarded as such had died with the pension fund.

The Authoritarian Era: When I was a bit older, I got a succession of jobs working in a business shirt and tie. My parents ‘ generation were the source of advice then: don’t make waves, please your employer, and give the corporation what it wants. But did it know what it wants? The mythical system of boss and bootstraps was gone, to be replaced by the near anonymity of the faceless attitudes steering a corporation. Reputation (which came from everywhere and nowhere) was everything, because it was a system of waiting for rewards in exchange for which you provided uniformity, nobody sticking out or sticking up too much, compliance, and moral ambiguity. The idea was to maintenance the career, maintain the resume, keep dirt off your name, and look for ways to climb. But the needs of the corporation are limitless, and demands often increase in response to the talent one brings, and they do not in fact necessarily allow one to remain uniform and quiet – they often sense and demand the exploitation of talent in a variety of ways that challenge character and potentially transform individuality and personality. The results, also, are not always clear cut. You might succeed at producing exactly the results requested, and wish you hadn’t. For example, you might be asked to educate internal execs on the use of a new software package designed for them by an outsource company, but those execs might find the software package they purchased does not in fact deliver much of what they had understood or been promised when they purchased it, and then the corporation is actually unhappy with the result, and looks upon the diligence and fulfillment with ill favor instead of appreciation and satisfaction. The moral ambiguity means right and wrong are relative to the outcome, not necessarily fulfilling what is asked. A corporation is often confused about what it wants can provide no assurance of the means of success. The corporation, too, had come to combine so many disparate communities and interactions that it could act almost like a body without a head. It could cry out for talent but reward mediocrity, only to punish mediocrity with layoffs shortly thereafter, retaining the talent and then demanding more mediocrity, which would be employment suicide. By the time the parental advice was given, authority had already become so ubiquitous that it was disconnected from purpose, and the system was taking on its greatest sources of talent from contractors who could draw the occasional firm, logical line in the sand: “Yes, we can do that; it’ll take more money or more time, which do you prefer?” But at least you got results – in the contractor, leadership – authority – came attached to competence and purpose. The system was already rewarding not people who did what they were told, but Free Agents it brought in from “the outside” – that magical place that the people came from that always seemed to save the day – people who thought less in terms of loyalty and authority than of competence, clarity, and excitement.

The Era of Free Agents: Daniel Pink, of “Free Agent Nation: How America’s New Independent Workers Are Transforming the Way We Live,” has said that Free Agents are “free from the bonds of a large institution and agents of their own futures. They are the new archetypes of work in America. It used to be that the bargain between employee and employer was that the employee gave loyalty and the employer gave security… The bargain now is that the individual gives talent and the organization provides opportunities.” What’s a Free Agent? A Free Agent is a professional contractor. Don’t think of a staff agency temp, once again cowed and controlled by two companies not one, no benefits, badly robbed of more than half their billable rate. No, a Free Agent contracts to bring in expertise, buys his own health care, funds his own retirement plan, and negotiates his own rate, which has to cover his taxes, benefits, and the rest. He bills back expenses and, at some point, in a worst case scenario, he is able to cut the cord if the corporation doesn’t hold to their end of the contract. Free Agents can work for Fortune 500 companies, for another one-person shop, on-site, remotely, travelling, locally, part-time or full or flex, and at nearly any level or type of talent or expertise. There are variations on this: some companies hire “contract employees” which basically means project workers with full employee benefits that drop off upon completion without further obligation. But in a troubled economy, hiring in any capacity has its own risks and headaches. You can’t build the core of a project team out of staff agency temps, though.  There are risks and headaches to bringing in 1099 contractors – one example: a lot of them are suing – successfully, because in most respects they’re treated like employees and argue they should be entitled to benefits – and now the IRS is cracking down with new rules on the contractor/employee distinction. It’s a dilemma, all right. I make no secret that I’m affiliated with Free Agent Source, the company that connects Free Agents with Client companies but with a corp to corp contract (no 1099), and keeps contractors in benefits and provides them a W-2 without taking half of it – Free Agents set their rates with the Client and FAS keeps a small, transparent portion to provide back office services, legal, accounting, etc. You can bring in just about anyone in any capacity as a Free Agent that way, without the problems attendant regular employment, staffing agencies, or 1099 contracting. But regardless of that being our solution, there’s a shift of culture, here, as Pink was suggesting. Whether the fabled economic “Recovery” comes one day, or the Kingdom comes first, there’s strong indication that this way of working may remain the fastest growing trend. Why not? When you’re up, it still makes as much sense as when you’re down. The Bootstrap Era is gone, and the results of the Authoritarian Era are mixed at best, and just not practical anymore (if they ever were).

Your view of the legitimacy of each successive shift will depend on what era you personally are currently living in. One of the things I hope to achieve is to live always in the next era. As an entrepreneur (a solopreneur – another new skyrocketing trend well before the bust), isn’t that the goal? To live with vision, with insight into where we are going, not mistaking the past for the present, but staking (a little exhilirating risk, to be sure) on what works rather than simply on what is and what was? Well, that’s certainly a key to prosperity for a lot of people whose version of Free Agency is self-employment. It’s an exciting time for work. Maybe I always liked to drum to my own tune, but that’s getting rewarded a lot these days – it’s what companies (like Google) actually say they’re looking for. Look at Twitter, Facebook, and Youtube. One of the many signals social media sends to business is that talent and conformity are often inversely related. This is good news. This is the work I wanted to do when I was a kid – work where the person doing it defines it as much as the recipient, and where the line between recipient and provider is a little fuzzier.

I don’t fault my elders, incidentally, for living in their time. It’s just that now a lot of us are taking apart the clock and asking whether it really was always the inevitable way that things worked. Time itself will tell, but some of us are already forging our own solutions.

Employment, Robbery, and Sacrificial Koolaid

The assumption of employment is all around us. I’m not knocking employment. Quite the contrary:

Rule of Work: Your work is not the venue. Whether your work is best conducted as an employee, contractor, entrepreneur, or volunteer, pursue the venue where you can derive from your work all the meaning you are intended to have.

But it’s sort of like my friend who has a Doctorate of Philosophy in Patristics from Oxford. He used to get asked, as a professor, by prospective employers in the U.S. for his transcript. He was typically met with blank, inflexible stares when he informed them that Oxford is an 800-year old university – it doesn’t issue transcripts. 75% of the doctoral candidates fail – if you make it, at all, that is the transcript. The assumption was that education is everywhere and always has been mass education, and rather than having to write books to graduate, you need to prove yourself by appealing to grades. Oxford is pass fail – for the degree, not for classes. For those interested in this topic,  you don’t even have to attend lectures (classes) at Oxford. You can sit under a tree all week and read, if you like, or just stay drunk all the time. What they require is that you read everything in your field, and take a final exam at the end that lasts about a week and is 100% written (essay form), and that you defend your thesis (which is what your book is arguing – your dissertation). That’s it. Read everything, write for a solid week intelligently discussing everything, and defend your own original idea expressed as a book which takes into account your knowledge of everything, and you get your degree. No transcript. Is it accredited? No, it’s 800 years old… etc. It’s like pulling teeth getting past assumptions.

The assumption of employment, though, is similar. It’s already been elsewhere observed that employees can get a home loan lickety split with two paychecks under their belts, or one paycheck and a letter from their employer. A self-employed person has to show a history of substantial profits on past years’ tax returns. That’s how the mortgage system assumes employment as the standard. Conversely, the tax system rewards self-employed people only if they show the least possible profit and claim the maximum possible deductions. That conflicts with the mortgage industry assumption and leaves lots of self-employed people without access to a mortgage, while showing up for a job for a month results in a home loan. The system is geared toward assuming employment is the norm. What do all the forms say – government forms, bank forms, even forms at the gym? Employer. What do employment applications ask for? Past employer. Sure, you write in your own company, but most people don’t seem to be aware that the relationship you have to your own company, as an entrepreneur might actually not be that of employee. Corporate structures are varied, and you might get shares, not paychecks. You might contract for your company, etc. You might be a “member”, a “partner”, and so on.

A pronounced example I encountered was when the market ate half of my 401K, because I foolishly listened to the “stay the course” crowd (i.e. Vanguard and the traditional investor braniacs who couldn’t acknowledge reality, only throw out doctrine, and tell the rest of us not to be “immature” investors who pull out our funds too soon and don’t stay in for the long haul. In other words – the people who told us it’s better to go broke than to question the received wisdom.) Honestly, the amateur hour stuff was not smelling the brimstone in the Judgment Day that was coming down all around them. Little devils kept saying, “Nah, this is just a “fluctuation” in the economic climate.  Let’s say I had $9000 invested, and I lost half, so $4500. My employer had matched at least half of my contribution, so someone actually said to me, “Well then you didn’t lose $4500. You basically lost nothing, because you still have what you put into it.” Now THAT, my friends, is a blind, dogmatic assumption of employment as the norm. But wait, it’s worse than that. A person who sees his services as valuable, something he ‘sells’ an employer, at best, knows that the matching contribution is part of his COMPENSATION. It’s part of the package of remuneration for his work.

In other words, if your employer cuts health care, you’re getting a pay cut. If your employer assigns you added responsibilities without added pay, you’re getting a pay cut (or at least getting snowed). I like that phrase they foist off on people young enough and inexperienced enough to believe it (or just craven enough to pretend they do) – “you’re investing in your marketability in the company” . Ha. The only thing you’re investing in is your reputation for price cutting – selling premium quantities and qualities of work for the lowest possible compensation. You’re the Walmart of employees. Or there’s the similar one, “because you care about the company”. Hey, caring is a two-way street – it’s like a marriage. Would you ask your spouse to do 100% of the housework and keep a full time job, because the spouse “cares about the family”? Not bloody likely.

But this isn’t even a pay cut. My example is one of robbery. The abject, and outright robbery of the system by (well you know who is responsible, if you’re paying attention – sure it’s AIG, but it’s more widespread than that – it’s an entire sector of society stealing from the other sector) – robbery that resulted in a LOT of us losing half or more of our retirement funds. Losing all of it, for those who left their money in until it hit zero. What they stole is the same as if they stole my paycheck. That money wasn’t legitimately lost to the “fluctuations of the market” – it was robbed by the looting and devastation and plundering and pillaging of the market. I know pretty much where it is. It’s driving around the Eastern seaboard with European leather and a blonde trophy wife in the passenger seat. It’s stopping to refuel on the way to a resort and spa where I can’t afford to eat the moisturizing cream it took a bushel of rain forest plants and a dozen children making a penny a day to produce for 3000% markup and some penthouse-dweller’s name on it. And on top of that, someone has the audacity to say, “but it wasn’t really your money.” “You didn’t really lose anything.” “Your employer *contributed* it to you. Like a gift. You can’t get upset over a stolen gift, now can you?

Well, it’s not a freaking gift. It’s one of the types of paychecks. It’s part of the compensation, part of the deal. Keep in mind, it’s taxable. Now or later, but it’s taxable.

The assumption is so strong that employment is the norm, that one easily forgets that the lingo you hear around the office isn’t real. A contribution isn’t really a gift. Caring isn’t really caring, it’s working for free. Marketability means gullibility. And ‘market fluctuations’, if you happen to work in the financial services sector, means causing a blackout, then coming to your house and stealing your TV set, then kicking you out of your house and taking that too (we don’t have an ARM, don’t worry), selling your home, and then offering you a credit card with a mafia-like interest rate so you can “rebuild” your “good standing” with the financial services industry. Oh, and lastly, telling you that none of what you lost was ever really yours in the first place. Equity meets late fees and cost of foreclosure. Finally, you blame it on an act of God, vibrations, hiccups, tremors, and “fluctuations” that no one could have prevented. So now you can’t even go to Church and pray about it without looking at your priest suspiciously, and he’s thinking “What did I do?” Good thing he lost his house too, but you’re all going to be moving into his apartment because you just lost your job, and your 401K is so devastated that pulling it out should just about cover the government “penalty” for pulling it out. Prison is starting to look good, but your Priest doesn’t like that idea, and they just told prisoners they have to pay for their own healthcare. You take your unemployment check to the bank, but they won’t open an account anymore without pulling your credit, and you know where that leads, so you give a chunk of that to the check cashing place, fill up with gas at double the price when this started, and drive home to watch TV shows about people living “successful” lives (as though nothing happened in the TV universe), and you figure all those guys work for AIG or had stock in munitions. And you fall asleep hoping you’ll get that temp job you applied for, where they “try on” employees, one after another, without having to give you healthcare or retirement benefits. And your only hope is starting your own Youtube reality show, except that everyone else is in the same boat and what, ordinarily might be fascinating, is now just banal and taken for granted.

Ahem. Yes. Well, the point is this:

Rule of Work: Nothing is true if it confuses an exchange of value for value with a gift given to either party. See Ayn Rand. Corollary rule: If you got something as a result of honest work, taking it away from you without a fair exchange is always theft – calling it something else turns wages into slavery.

Yes, the assumption of employment as the normative form of work relationship prevails, but some of what comes with that assumption isn’t employment, it’s at best what the old South used to call “wage slavery” and, at worst, is just plain robbery, snake oil, machination, and exploitation. There’s nothing wrong with employment, if it’s honest, if both parties are exchanging fair value for fair value with their eyes open, in a transparent environment. But treating employment as a privilege, as though one should aspire to it independently of compensation, accept it as normal without reference to the entitlements governing every other form of trade (rhetoric venerating “the market” aside), is an additional set of assumptions that amounts to drinking the sacrificial Koolaid.

It’s bad enough to assume that life, ‘legitimate’ life, revolves around punching a timeclock or getting a salary, in contrast with the work itself. It’s unacceptable, though, to swallow down the notion that it’s really all about the love, and what’s in the contract is just Christmas gravy. Dunno about you, but I can get a turkey anywhere – I’m up for the gravy.

Confessions of a Quiet Home Office Worker

I do project work and consulting, and my office is one of the largest rooms in my home. Like a lot of home office workers (I prefer “home office professional”), I always have multiple projects at once. So working all the time is just part of the deal. If I’m not working on a client’s project, I’m working on one of my own. This is not a complaint – far from it.

Blast from the Past: Rule of Work #1: If it’s worth doing, it’s worth doing as work. It’s a good life. A life of constant meaning.

That said, it can be hard to convey the particular circumstances of it to people looking in from the outside. It might be explaining to someone why you aren’t treating e-mail like chat and responding instantly, or why you’re selective about volunteer work and need to get paid for your core competencies (you know that auto mechanic who is always getting hit up to help with friend’s cars?), or just that yes, as a home worker, you are entitled to sleep, go to the gym, and spend time with your family – you’re not giving that up and sitting there waiting patiently for any word to drop from your various contacts, clients, and colleagues. My wife and I recently had to establish for her business that yes, it’s OK, and absolutely necessary for a hairdresser to take a couple of days off per week and get enough rest and down time. But aside from the basics – what your work is (avoiding mission creep), and when you do it (avoiding the “on call” nightmare),  the simplest way to define your work environment and work process is to outline your approach to the atmosphere of constant communication. So here, in brief, is how one office works. These are the terms of my self-employment:

Hours Flexible: I might be working at 3am or in bed by 9pm. I might sleep until 4pm, which might be sleeping 5 hours or 15. I work off of appointments. I make them, keep them, and then the rest is up to me. Of course there are deadlines, but they’re flexible. We’ve all heard “under promise and over deliver”. That’s deadlines, too. If I say something usually takes two weeks, it’s because it usually does. But if a blizzard wipes out the internet or power, then it is what it is – we don’t swear by deadlines, and we don’t miss them. Also, with any kind of project work, your own deadlines have to account for client deliverables. If clients hear “usually two weeks, assuming all your deliverables in place to start” and they send their pieces 13 days in, you tell them “about two weeks from now”. If you get it earlier, well and good, but fixed deadlines are a source of ruin – our deadlines are like our work hours – they’re movable feasts. Hours flexible and by appointment means too that I avoid phone tag. I set phone appointments and I don’t miss them (I’ve missed only one in the history of my business, it was with a friend, and I’m still embarrassed by it). There’s nothing worse than burning time for everyone by getting together with clients “whenever”.

Not On-Call: Personally, I never answer the phone, unless it’s my wife. I know that’s radical, but it works in my line of work. For one thing, I’d never get anything done – I’m actually working on clients’ projects, after all. For another, I’m a consultant, so I charge for phone time, and so I call outbound only, by appointment. Other than that, voicemail messages are transcribed instantly and sent to e-mail, where I respond to them while multi-tasking, without interrupting scheduled projects. I set appointments by e-mail, so everything goes smoothly. When I picked up the phone and answered all my inbound calls, I got unplanned (so un-billed) calls 24/7 – picking my brain, asking for advice, seeking a “how to” that “shouldn’t take long” (“you’re a mechanic, can you just listen to my engine for a sec – I know it’s a weekend…”), and I lost tons of hours I’ll never get back to “I just prefer to work exclusively by phone” – even for the most trivial matters. So I stopped. I’m not a call center. I can always hire one, but then the price has got to see a 400% increase. Seriously – I save bookoo buck for my clients by NOT putting Suzie or Jim or Karesh on that phone 24/7. So now when someone calls my business line, I get it as e-mail, and that also weeds out the spam calls, which is a nice bonus. And it converts a synchronous medium (“I want you *right now*!”) into an asynchronous one (email response: “I got your msg. The answer is yes.” or “Thursday works better for me – how about 2pm or 4pm your time?”). Besides, frequently I can actually respond faster – instead of wasting everyone’s time playing phone tag, I often get an e-mail response out without missing a beat (but again, I don’t promise it).

Blackberry Not Included: I don’t use mobile devices. Again, if I did, I’d never sleep, eat, or anything else. I’m not part of the Blackberry culture, and not because I’m somehow technologically challenged or old-fashioned. It’s because I don’t want to be stalked by every little concern, wish, or personal observation everyone in my “network”  might have. You’ve seen those commercials where someone introduces the crowd behind them: “this is my network”? Really, that’s exactly what it’s like for a lot of people. I can’t get work done that way. If you were in an office, would you hire the person who is always on their phone to work on your team? Neither would I. How about this: do you take your “device” into the john with you? That’s what I had to do when I answered my phone all the time – if I took e-mail along too, I’d literally have to shower with it. E-mail is in one room and waits until I see it. When I leave that room, it’s family time only. I don’t promise clients always-on response time, I don’t send out a general announcement just to take a day off to myself or with my family, and I don’t apologize “for just now getting back to you” after 8hrs because a lot of people treat e-mail like chat, spend all day in Facebook, and keep their earpiece on and Mobile e-mail vibrating in a holster. I treat myself as the busy president of my company, not the Blockbuster cashier of my company. The results are, I communicate effectively, selectively, and I accomplish things my clients need, generally by the time they have to ask. And above all, I get peace in my work.

Rule of Work: It is always, always the goal to work on, by, and according to your own terms. You’ll compromise, but if there’s no end to that, it’s not work, it’s servitude.

Terms of Self-Employment: So, when I hired myself full time, those were the terms I accepted and I have insisted on abiding by them. It’s different than how a lot of self-employed people work, I know. I don’t begrudge them their e-mail holsters, as long as they’re not doing it while driving – and then of course I think they’ve got a screw loose (look at how they’re weaving over the line). We’ve each got to define our own office rules – the terms of our own self-employment – how free we are, how harried, how much of our lives belong to who and what. How effective we’re going to be vs. how thinly spread. My wife finally deciding on two days off to reset, means she’s stellar all the time, not stellar for 10 hrs and tired for 2. Maybe, though, by drawing a circle and defining some time as exclusively ours and our families’, some part of our lives as immune to the interests of others – by not defining self-employment as a modified form of wage slavery, where anyone with a communication device can wind it up and make you jump as surely as a foreman in a yard – where you’ve traded one boss for hundreds – maybe we’ll all encourage one another to hold the line for the dignity of our professions in the face of all the incessant yacking. If you don’t think about communications, you’ll spend so much time on the phone and in e-mail that may have stopped doing what you love. And what good is that?

Rule of Work: How you handle communications will determine whether you do what you love or merely talk about doing it.

Freelancing vs. Mom’s Couch

CBS was talking this evening about the growth of freelance work – projecting significant growth over the next couple of years. What was striking was how negative the reporting seemed. One of the two people interviewed was saying “the important thing is not to be idle” and the reporter presented freelancing as being just one rung above collecting unemployment – with employment clearly being preferable to freelance work, the moment the former is available. The entire piece presented freelance work as a regrettable sentence, a misfortune, and implied that somehow it means less money. What are these people smoking?

What we’re seeing is a lull in the parental relationship between employer and employee, and I think that’s a good thing. But it’s like listening to 30-year old men complain that they can’t live in Mom’s basement forever. The idea that employee status is superior, is the goal, is in fact the pinnacle of success in our culture is assumed, as an unaccountable absolute. Didn’t we just learn the opposite? Apparently not. This is my biggest gripe with those who keep saying, “it’ll turn around soon” – like Napoleon – “this’ll all be over by Spring”. Besides the fact that they’ve been saying that for the last two years, a tiptoe through the tulips faith-in-magic kind of optimism that has no basis in how economics really works, there’s no real learning – no real sense of cultural repentance – it’s as if there were nothing wrong with the system as it was, and this is something that just happened to us. It’s like listening to a culture of perpetual adolescents who ruined their credit, present it as if they just had some bad luck – the universe didn’t smile on them, and are clearly going to be shopping like mad as soon as they can be, applying for that credit card the moment they’ve got a chance.

There are three lessons of this economic event for adults. By adults, I mean those of us who aren’t looking for yet more dependency on the cultural parents that failed us so spectacularly. The first is that you obviously can’t dump trillions into a global policy of invasion and not break the empire’s bank. This is not primarily a political blog, so we’ll just say that and set it aside, but if we don’t believe things just magically ‘happen’ to us, we’ve got to say the cost of hubris is a factor. The second lesson is that it’s your fault, all this, and my fault, and we all share in this fault in some way. It’s silly to explain it as just a few rogue bankers, or the entire lending industry, or an irresponsible bunch of poor people (if you’re that type). You did this too, and I helped, so adulthood means not blaming everyone *except* ourselves for “getting us into this”. The third lesson we’ve mentioned before – all the BS that gets parroted from previous generations about job security, education being the ticket to vocational wellbeing, economic stability being the same as having a job, etc – it’s hoodoo – and we can’t go on believing in the face of empirical evidence.

What this economic shift offers us, actually, then, is a chance to grow up – a chance to get ourselves a little cleaner – an opportunity to live soberly. It’s interesting to watch even those who pride themselves in the rhetoric of self-reliance wail about “jobs”, as though that’s all that matters – someone coming to bail us out as individuals, all the while lamenting the “bail out” of the banks (which we all generally agree is a looting). Jobs. What’s wrong with going freelance? The CBS piece linked it with the notion of a lowered wage standard in most jobs. Well, that’s likely true, wage standards are likely going to be lowered for some time to come. Partly because we used an unprecedented portion of our economic potency to take over a number of pipeline routes and petroleum deposits in the Middle East. But are we really saying that the big disaster is we might end up working for ourselves? Or freelance?

And the notion that freelance work necessarily pays less, I find dubious. At first, some of it will. After all, there’s the silly notion in some corporate circles that freelancers are less valuable, more transient, and somehow ‘deserve’ less than employees. Sensibly, the opposite is true. We pay our own benefits, our own taxes, our own expenses, and there’s cost involved just being freelance. On top of that, you survive by being superior. Someone wants to pay me employee’s wages, and the discussion is over – it’s got to be a lot more. Desperation is going to make some people foolish in what they’ll accept, and they’ll price sell. OK, for a while. But it won’t last. A lot of us are going to get strong, while they just get robbed.

First, think about it – shouldn’t you, if you were a freelancer, be entitled to what they’d pay a staffing agency for a temp? I don’t mean what they’d pay the temp – I mean what they’d pay the agency itself. You incur the same costs, so damned straight that’s what you should be paid. Probably more. The staffing agency won’t pay for your doctor bills – you’ve got insurance costs to cover.

Second, the shoe is going to shift feet. As the number of freelancers doubles, we’re going to find new ways to organize, connect, and consolidate resources. The Freelancers Union is seeing a nice influx about now. The growth of social media indicates that a coming trend is for any set of disconnected people fending and fighting for themselves to, as they grow, utilize the attitudes and techniques of social media, which in turn will further that growth, and in turn further consolidate their ability to support one another, act in concert – in mental, emotional, and physical unison. In other words, what’s coming is an initial feeling of desperation followed by a transferrance of clout – a shift of power – from the employer to the contractor and to the freelancer.

What’s beautiful, from a freelancer’s perspective, is that they don’t see it yet. Opportunity is glowing in the dark, and they don’t see it. And this will help further the future of freelancing. The other thing that’s going to happen is an intellectual and emotional campaign to retain employer-like control in the context of contractor and freelance relationships. Be ready for it. Yes, it’s already there. It’s going to get worse before it gets better. But not to worry. The social media trends would seem to indicate an incredible likelihood of taking this out of their hands.

So, I’m not ready to lament about being out on my own, or wax nostalgic about mom’s sofa. I’m not sitting around and mourning the growth of freelancing and looking at it as a social problem. For one thing, some of us are thinking about how to make it a source of prosperity. For another, the freelancing trend offers genuine hope for a more mature, more self-aware, more ethical set of relationships – a more equitable exchange of value between service providers and service buyers.

Instead of standing out there shouting “jobs, jobs” with the obfuscators, the anti-benefits crowds, or the people who are just going along, why not ask for reduced taxes on the self-employed, and opportunities for access to the same kinds of benefits (especially group health care) that employees have long relied upon? The Freelancers Union, Free Agent Source, and congressional legislation allowing the self-employed to act as groups for purchasing healthcare all seem like positive directions for this.

I’ve only one thing to say to the CBS group about their report: I hope to remain *unemployed*. I’ve no problem with employment per se, but it’s not the holy grail – doing what you love for a fair exchange – that’s the target. I like being freelance, or self-employed, or an entrepreneur. I have no desire to trade freedom and prosperity for the illusion of security – if employment is an end in itself, rather than meaningful work, great pay, good benefits, and diversified sources of income, then why? Just because Mom has a nice couch? Relying on a single, canned income source wasn’t a good bargain at the start of this thing (just look what happened). It’s not a good bargain dealing with the fallout. You CBS guys should look on the bright side, or at least acknowledge that there is one, even if the cost was, in the estimation of many of us, unacceptable.

Reclaiming the Meaning of Money & Time

A friend and I were talking the other day about how we’re so used to thinking, as employees, of everything as net. The company takes out taxes and healthcare, and what’s left – that’s what you live on. But when you’re self-employed, you pay self-employment tax on top of your income tax, and you have to bank that out of every deal. So If you made $400, you really only made $200. And then you’ve got to buy healthcare out of that. If you made $400 only 10 times a month, and sock away half for taxes, and pay $250 for your half of the insurance (that’d be really cheap),  your $400 is now $150 “net”. $150 of employee-equivalent pay.

A lot of employed folks would look at this as a good case for not going out on their own. It’s actually the best case for why freelancers need to charge high rates. You just can’t do it for nothing. And what, freelancers aren’t supposed to have healthcare, or savings, or be able to eat? So, the goal is to figure out how to bring those fees up. Seth Godin offers a great quotation (don’t remember his source): “There are two kinds of companies: those that want to lower prices, and those that want to raise them.” Those who shoot for the bottom, price-cutting, price-selling, appealing to price shoppers, and those who look for ways to add value, be the best, and raise prices. I’m with the latter. And I encourage my family members to hold the line on that, too.

I looked in on a conversation in LinkedIn where a person offered a service for $100, no conditions, to anyone, regardless of criteria. I provide the same service, and I can tell you it’s twice that, minimum, to do it right and do it consistently. I didn’t respond – no need – the entire community of freelancers jumped on him, asking if he realized that this wasn’t sustainable, that by aiming for the bottom he’s just appealing to the guy that wants it at $95, and encouraging the person who’ll do it for that, and not have healthcare, and not eat right. They ate his lunch – I couldn’t believe the amount of traffic pounding this guy down. He didn’t get it either. Bills himself as the president of his company but made a crass, rookie mistake in public, and should have copped to it quickly but wouldn’t. Who hasn’t done that kind of thing in one form or another? So you have to feel sorry for him, but wow – he made the 2nd mistake too: he just kept holding the line. “If someone doesn’t want my services, they don’t have to buy them.” He was missing the point.

A lot of us have had a prospect walk away because the price was obviously too low. And they’re right to. You can’t sustain good, consistent work that way, and companies that are in this for real want good, consistent work. They don’t want to watch a price cutter self-destruct, which is where it leads. A family member is a hairstylist, and a friend of hers comes from the Supercuts environment. The price difference is shocking. And you can’t invest in growing your business if you’re geared for the bottom. And once you do that, it’s really hard to break out of it. You can’t win, without retooling, infusing your business with some funds and a lot of effort, and changing the way you do business, willing to lose some clients. It’s a rough road to hoe if you’re taking care of a family and depend on repeat business; I don’t envy it. But that’s what Supercuts, superstores, super-anything does to an industry – it leaves its people scraping the bottom for the cheapest prospects there are, without decent health care, with an impoverished diet that takes years off their lives, and having to explain to people that work is worth something.

There’s a related principle. Not only is the compensation model for freelancers really fundamentally different than for employees… and we all know this, but when you’re rearranging your life accordingly, it’s something to meditate on and ponder… but so is this model for time. If you spend 8hrs at the office, your ‘work’ is presumably done, because your work is defined by the man. Your work is your job. But it’s really not done. You still have to pick up the kids, wash the car, buy the groceries, go jogging, and all the other things you do. What the freelancer realizes is that these are work too.

Occasional clients think a freelancer should be waiting at his desk at all times, when they get back to their office, ready to respond in an instant. “Where were you yesterday?” You don’t take vacations, don’t take a day off, don’t go to the gym. You work when they work, and you work when they sleep, because 24-hour turnaround is in demand, too. But that’s not sustainable. What, freelancers shouldn’t get 8hrs sleep or go to the gym? You can’t hire an assistant to work out for you, or get proper rest so you stay healthy for another day. The real story is that the model of work has been distorted somewhat by separating it from the home. I’m not suggesting there’s something inherently wrong with office work, just that it doesn’t explain, describe, or account for everything. The truth is that when a freelancer cooks the meals, provides the transportation, goes to the gym to stay healthy, or just engages in personal hygiene (how long does your full regimen, day and night, take from your day?), that’s work.

And there’s nothing wrong with that. Work is what you do when you wake up, and what you do before you go to sleep. Not that there’s not room to go read a book and rest, but that rest is part of the work, too. If you read, it’s fuel. If you rest, it’s preparation to work – it’s restocking the shelves. When you relax, it’s to be ready for the intensity and energy. Same thing if you blog, folks. That’s the truth. In my case, without it, I can’t think at the pace that’s necessary to do what I do for clients. We’re *whole* people, and we need a *whole* life, sustained by work, involved in work, and linked to our work. This is yet another reason work had better be a primary source of meaning your life.

Income, though, is not what’s left over after the things that sustain your life are taken out – like healthcare. Income is what you use to take care of your whole life, including your health. When you short the one, you’re shorting the other. Likewise, time for work is not the time spent on a task someone else makes you do, or a task that you have to drive to get to, or a task that directly impacts your client. Time for work is time spent on the entire person, the *whole* source of work, your whole life. It needs to be balanced, thought out, and reasonable – you can’t just sleep for two days every week and expect, in most freelance scenarios, to be successful. Even if that’s the sum of leftover time, what about riding your bike and, again, personal hygiene, etc.? Time spent on work is, appropriately, time spent on your whole life, precisely on *keeping* it in balance, keeping it functioning at optimum, and in keeping with the very things you need to get paid for. I get paid so I can buy healthcare. I spend time and the gym so I can stay healthy. You can’t throw either one over your shoulder.

Get paid a lot, work 16 hours, not 8 (or acknowledge that it’s work) and, though you’ll then realize that our taxes really are obscenely high, you’ll at least be able to explain what you do without feeling quite as harried. A little harried maybe, but not because there’s no reason for half of it. And no, you’re most likely *not* overpaid.

No Mortgage for Freelancers?

Your local NPR or public radio station  “The Take Away” is running talk about how freelancers are treated unreasonably (I’d say prejudicially) for mortgage loan applications vs. job holders. Got an offer letter or a couple of pay stubs from a job? You’re on the fast track for refinance or a new mortgage. Freelancer? They want two years of tax return documentation indicating a high net. And freelancers are highly motivated to reduce net as much as possible, for tax purposes, by showing expenses.

So freelancers are faced with two horns – you either get taxed to death (don’t forget the extra self-employment tax) or you don’t get to own a home. The current society is structured to reward job holders and punish freelancers.

I hate this too. But it’s not going to stop me. Society is always in tension with the individual – I already figure society is not out to help me. I consider it a given, so I’m never suprised by injustice, shortsightedness, or the general bias if not downright persecution of the individualist. Sure, if you’re a large corp, you get a lot of breaks. As a sole proprietor or small LLC, they’re going to stick it in you as often and as far as they can. I take it for granted.

But if you didn’t catch our recent article on home ownership (and other fallacies) – Mount Olympus is Dead – you might want to, if this concerns you personally. I’m not so sure I *want* to be handed anything. I’m not so sure that what a lot of people call home “ownership” isn’t just a fairytale we tell ourselves while sleeping in homes that are 90% bank-owned, if they’re average. The notion that homeownership is the prize of success is still, in my book, a load of crumbcake. Especially if we live there by having our heads so far up our corporate boss’s butt that the job feels extra-secure. We’ve learned a lot about both homes and jobs lately.

That aside, effectively preventing a lot of self-employed from having home loans is a raw freaking deal. It’s retarded. It’s stupid. It’s shortsighted. And… <drumroll>… the good news is that it’s going to change. Don’t believe me? I’ll be here for the next few years, so I’ll be prepared to eat my words if I’m wrong. But I don’t think I’ll have to do that. It’s going to change, because structurally, the way in which work is conducted is going to change. Is already changing. I won’t beat that drum all over again here – we’ve said it in lots of other articles. But one line: Companies, if and when they come out of the economic disaster we prefer to call, euphemistically, “recession”, will include those that make the same stupid mistakes again, and those who have already irreversibly adapted to the new order – a more transactional relationship with workers – one that is contract-based, temporary (most jobs are destined to “become” temporary – they always were – we just pretended they were “permanent”), and one that requires individuals to take increased responsibility for negotiation and for securing needed benefits.

And, kids and kiddoes, the mortgage lending industry will respond to the changes. Perhaps slowly. Perhaps belatedly. Perhaps stubbornly (major finance companies have had their heads up their own arses over refinancing troubled mortgages and have elected to take losses rather than question their own morality and superiority – shooting themselves in the foot and homeowners in the head – we will remember this about them – we will remember it a long time). But they will, ultimately, respond – because it’s not up to them. The sheer pressure of the massive growth in more transactional workers along with the surplus of homes and overextended building will mean that if anyone does not yield, someone will simply start or create a business out of catering to the facts – financial elitism be damned.

In the short term, it may be a darned inconvenience. But so what? It’s part of the deal. It will be, regardless of whether you and I like it. And in the end, the world will have changed. I’m ready for some of that. The day we see the self-righteous lenders who denied refinancing to all those souls who could pay a reasonable rate, and kicked them out into the street, so the lender could take a stupid loss on the home because “they’re wrong – they’re bad – we shouldn’t have to refinance them – they shouldn’t be rewarded for not sticking to the deal we made with them” (yeah, those guys have publicly said all of that) – the day we see them hat in hand offering loans to woo them back, or their children back, without the traditional securities that didn’t mean a tinker’s damn anyway (their job and their car), some of us will be laughing. And we’ll know that, with the same negotiating power that those folks will have with income sources as the transactionally employed – contractors, freelancers, entrepreneurs – they’re better off and more in control of their live.

There are foolish people who will make foolish deals. There are predators who will prey on weaker understandings. That will go on, too. But it’s not going to be the whole story. I’m interested to hear how “The Take Away” topic plays out. But one thing I’m even more interested in – how it plays out in the culture of work.

Mount Olympus is No More

When I was a kid, it was very clear what my parents and parents’ parents expected of me. Acquisition. After WWII, words like “security”, “stability”, and “financial independence” seemed so important. But then, you had to give up your financial independence for a mortgage, stake your stability on a job, and trust your security to an insurance company, a retirement fund, and lots of men in uniforms.

And what has happened to that world? Not only have housing prices relative to income soared, but the mortgage has turned out to be a curse in many cases. Your 401K or your mutual fund may be worth a negative (you won’t be making that money back that way), and health insurance is so obscenely priced that if your employer didn’t pay most of it, you couldn’t afford it on a “middle class” income. And finally, the security once gambled on individual employers is gone. It was gone before this bust (it was perception, not reality), and it’ll have been long gone afterward. No one retires anymore at 50-65 with a gold watch and a pension. If you aren’t already an executive, you can forget it.

The wisdom, in other words, of the generation predicated on a world war and a cold war, has become a disproved religion, a mantra for those who prefer to live in old movies. None of us can afford, any more, to live in the world we inherited – we have to live in the world around us. The old, tried and ture system has become the ponzi scheme of contemporary economy. So what’s changing for us?

In a brilliant article, recently, wisebread detailed the fallacies of home ownership as an investment. It’s not diversifying your investments. A mortgage, they argue, is a foolish form of renting -  like putting a car on a credit card. Most of your money is lost to interest, and the growth barely exceeds inflation – most decent investment funds can do much better. The return at sale from appreciation doesn’t even touch the the costs of upkeep, improvements, insurance and taxes, and that’s with the tax deduction figured in.  If you broke even at sale, in reality, looking at all the math, that would be amazing. And we have tons of historical data on the performance of housing, when applying the same rules as other investments. The money saved from renting, invested in something else, is likely to make you more financially independent than a home owner with a mortgage – says one economist, “You’re supposed to diversify as much as possible — put your money into stocks, bonds, many different geographies — and then use the income to rent whatever you like.” There might have been an argument against this 40 years ago. There isn’t, anymore. You use the money saved on upkeep, insurance, and taxes to pay your rent.

The traditional job, too, we’ve said is a dinosaur. Working for one company isn’t diversifying sources of income. It’s putting all your eggs in one basket, and look where that’s got us. The future of smart investment, for your work (and if  you’re not treating your work as an investment, why not?) is contracting. Whether as a free agent or someone who’s self-employed. If you were running a business, would you want just one client? “But that could make you rich,” you hear all the time, “if you could just get Walmart to buy in”. There are just as many broke, bankrupt souls who will correct that misguided notion who went down highway 71 to Bentonville (or went down because of it). Those stories needn’t be recounted here – you can find them anywhere. So if you wouldn’t want all your income dependent on one source as a business owner, why as an employee? A century of history with the company store, that takes care of everything, has taught us that eventually it doesn’t, and certainly it’s not the most stable investment, when looked at as an investment, fairly – like any other. Have you looked at how much you’re giving away by being an employee vs. a contractor? And if not, why not? If not, your security is more likely in the mythology of joining, and not demonstrably mathematical security at all.

But the world is changing with or without us. Not only is loyalty not rewarded, it’s punished. Even for those staying in a traditional job, if you stay too long, you hit a ceiling at which confidence in your ability wains, and you find contractors or outside candidates taking your next step. And you won’t be getting that gold pen, either. We’ve already talked about how contracting is widely replacing traditional employment – from the employer’s point of view. The sound investment is in yourself – not just as a feel-good mantra, but in actuality, in genuine economics. Right now, there are still people saying “but I’m scared, and it’s more comforting being a… whatever” – they’re saying that now, but it’s about to get scarier being a whatever than at least having other irons in the fire. It will be gradual, yes. But gradual economics is not like gradual geology. It will be in your generation, and mine. Even small employers will be preferring contractors to employees.

What we will tell our kids, if we’re looking ahead, with vision, is that financial independence is not summed up in a mortgage and two cars with payments in the driveway. Security is not in a fund your employer picked out for you, and you’d better open a savings account, because insurance, unless the current government succeeds, will belong to the rich. Unless you’re starting out rich, start saving. And lastly, stability is not rooted in placing all your faith in the company, the organization, the corporation that is quickly distancing itself from what it was and still is portrayed as in popular culture. Stability is in a preponderance of investment in your multiple talents in multiple venues with multiple sources of income – not one. Whether work, or bonds, stocks, funds, or whatever. The internet geeks that have been telling us, amidst the scorn of their elders, to cut the traditional ties and live free, be mobile, be flexible, be responsive, be in more than one place, ditch the land line, the permanent address, and ditch keeping your life in file cabinets – be able, at least, to travel the world – those bratty, brash, bravado-mongers – those are simply the ones that realized, before you and I did, that the myth was just that. A Mount Olympus from someone else’s dreams. And it’s not bleak to discover this – it’s immensely freeing and empowering. It’s as if the answers come into your head at last, and the world is one of science – it begins to make sense.

Love your and honor the bygone generation, but don’t live in their story. It’s far more interesting to see past Olympus to the other side.

Social Compact for Work Changes

Frankly, I find it hard to think of a recession only in terms of the numbers that matter to the people that got us into one. It’s still a recession, or worse (we don’t like the word depression), if people are hunting for jobs for 16months, qualified people with degrees are still losing their houses for not finding work, and applicants are having to go through eight interviews just to get a rejection letter. Replacing employee relationships with temp jobs isn’t a stabilization of employment (without employee-like benefits), either, so the numbers can’t always be taken at face value.

It may well be that what has happened to the workplace for job holders and job seekers is not temporary at all – but is unprecedented and isn’t going away, not really. Hard to predict at this point, but signs that some changes may be more permanent are the reduction in employer funded retirement plans with widespread elimination of matching, and reduction of health care benefits with widespread use of contractors to avoid such entitlements. Pay cuts might be temporary, and it might be just belt-tightening to cancel the company picnic or the Christmas party. But eliminating health care and retirement – that’s changing the employer-employee relationship substantially.

Now even employees, in some cases, are really just ‘contractors’ with unemployment insurance. If that! Cut someone down to four days a week instead of five, and they’re not full time anymore. They may not be entitled to much of anything.

Some shifts in the employer-employee relationship have been building for years, but the recession, by making companies acutely cost-conscious, has accelerated them.

“I think we’ve entered into a fundamentally new era,” says David Lewin, of the Anderson School of Management at the University of California, Los Angeles. He describes employers as “leery of long-term commitments,” including both benefits and pay increases. . . .

In some cases, employers keep workers, but not on the payroll. Last December, staffing company Spherion Corp. laid off Roberta Marcantonio, a 14-year veteran who sold franchises to local operators. It brought her back as a contractor paid by commission. “We didn’t need the fixed costs, because of the recession,” says Spherion’s chief executive, Roy Krause. “But we needed the skills when she was able to sell something.”

[Wall Street Journal, Oct 20, 2009]

When you combine a trend toward ‘trial employment’ arrangements, with the growing practice of filling out workforces with contractors on a larger scale, and the reduction of the kinds of benefits that signify a long-term relationship (the equivalent of an engagement ring for an employee), it seems as if the relationship of employee to employer may itself be obsolete, at least in some fields, in some jobs, for some populations, and that what we’re witnessing is a work-culture shift, not a setback, not a minor adjustment, and not perhaps a temporary redistribution.

The contractor ranks are swelling. After all, even the unemployed are what, ultimately? Contractors waiting for a gig. The question will be whether this is empowering, for most, in the sense that it’s more like running your own business, or whether it will be debilitating, so that being a contractor is just another word for full-time employee with no benefits. If the latter, it may essentially ruin contracting for a lot of people who thrived with it.  What I hope, with glass hope,  is that it’s more the former, and that a shift to enhanced fulfillment from work, and from the very character of a traded, value for value relationship, will enliven the world of work for more people than ever before. We’ll see.

Shopping for Employees

I’ve noticed a lot of people describing getting several interviews, even multiple interviews in person, only to get a form letter rejection. Sure, sometimes it’s a fake listing. Employers do it all the time – a listing to invite external candidates when really an internal one is what they want. Often, it’s that they have no idea who or what they want to hire when the post the position, and sort of figure it out through the interview process, wasting the time of most of the applicants until then. Frequently they’re just wasting time in general, because they’re indecisive. But this is exacerbated by the increasing number of interviews being requested. “Can you come back in a third time. There’s one manager who was absent who also wants to interview you.” Come one, get it together, right? Oh, but it gets better…

recruiters and academics who follow such trends agree that more people are being asked to do more interviews before being offered a position. They also say it has become ever more common to ask prospective employees to work temporarily for a few months, with the possibility of a permanent job at the end. . . .

“Hiring managers are increasingly prone to shopping,” said Todd Safferstone … “In better times, we did one or two interviews. Now we really want to make sure someone will fit and we do a minimum of four interviews” . . .

“We’re definitely putting people through more paces than ever before,” said Michelle Robinovitz . . .

I ran into an acquaintance recently who told me that he had had eight interviews for a position and was still waiting to hear. . . .

hiring people on a three-month trial basis — usually without benefits — has become increasingly popular [New York Times, Oct 10, 2009]

Eight interviews. Trial employment. Shopping for employees? Makes you feel downright… special, doesn’t it? Like a cockapoo in a pet store.  Not long from now, hirees will be getting microchipped, too. This isn’t a trend that started with the market – it’s a trend that’s amplified by the market. If it took three months before the bust and five months after to locate a job when starting from scratch, what does it take now in a post-recession recession? It may take more patience than you’ve got. Here’s an idea: start a business while you wait. It can’t hurt. You can always dump it later if you hate it. But in the meantime, it not only will lend some dignity to your vocational impulse, but it may make the job search obsolete at some point. Rule of work… what is it number 60 or so by now? Always keep two irons in the fire. It may save your dignity, but it will almost certainly save your arse.

“Fear is the Mind-Killer.”

I went to a meeting and watched the fear in the room: grown men cowed and bowed down, looking for leadership from other fearful men made only slightly more confident from being near the center of the herd. I have a lot to say about a society built on fear, or a society built on corporate cultures that are built on fear. Fear of being unneeded. Fear of being unliked. Fear of too much attention or too little. Fear of the less competent or the more competent. Fear of being accused. Fear of being evaluated. Fear of being undervalued or disrespected. Fear, as a way of life. As a way of business. I have a lot to say about the order of a society that could create such fears in men, and deprive them of heart. Could even make them pretend to be afraid, just to earn a check. No doubt I will say more soon. But for now, I’ll offer these rules:

• Never fear losing what another man can freely take from you. Only fear losing what can never be taken by another man: the inviolable self. The world will present choices between the two, constantly, occasionally, or once for all. Be ready; be unafraid.
• Never be afraid of losing something given. If you’ve earned it, it’s robbery to take it away, and there’s an appropriate recourse and mourning. If it has been given, never set your heart on it in the first place.
• Never be afraid of losing a job. The only thing more demoralizing than losing a job you’re afraid to lose, is having a job you’re afraid to lose. Believe in those entirely personal qualities and skills that will always procure your survival, or else set immediately upon the path of discovering them. Be unafraid, or be finding your way out of fear.
• Money goes a long way against fear, so save money. But remember, it never goes long enough; death is coming for us all, all at once or by degrees. The real freedom from fear is freedom from the fear of death.
• When men claim not to be afraid, look at their rules, even if they pretend not to have any. Think of what they do and don’t in terms of rules. If the rules are designed for self-protection instead of self-expression, then they are fearful men.
• No one can be unafraid for you. You can look at the courageous and take heart, but some day you’ll wonder if they’re just too foolish to be terrified, or else think you can never be like them. Being courageous requires you to find your own values, but to dig even deeper and find your secret self. There is the heart of your courage, not another man’s courage. When you find it, insist that it live, guard and nurture it until it can stand on its own, and you will soon find it is the strong, fearless man you want to be.
• Freedom from fear will invariably be called arrogance. Don’t be afraid of being thought arrogant, where arrogance is simply absence of fear.