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A NATIONAL SNAPSHOT: AMERICA’S INDEPENDENTS
For the 4th consecutive year, the 2014 MBO Partners State of Independence Report
shows that independents represent all ages, professions, educational levels and
geography. They’re actively contributing to virtually every sector of the economy.
It’s likely that many people you know — your neighbors, friends or relatives — are
independents or have worked as an independent in the past. In fact, about 40% of
the US adult workforce consistently reports that they either currently work or have
worked as an independent at one time during their careers.
These independents — 17.9 million of them working primarily as independents and
12.1 million working in side-gigs — cross all lines of geography, generation and
gender with an underlying current of passion, self-reliance and purpose. In the
US, independents live and work in all 50 states. Our 2014 data is consistent with
2013 findings: about 4 in 10 say they live in urban and close-in suburban areas,
30% live in outer suburbs within commuting distance to a major city, and another
30% live in small towns or rural areas.
Age runs the full adult gamut from 21 year olds just stepping into adulthood
to thriving octogenarians, who often still report to work on a full-time basis.
Millennials (aged 21-33) comprise 28% of the independents, Gen X (aged 34-49)
29%, Baby Boomers (aged 50-67) 30% and Matures (Aged 68+) 14%. Consistent
with prior years, men and women are close to equally represented with men
making up 52% of all independents and women 48%.
Together these independents measure up to 30 million strong. As noted before,
prior to 2014, the MBO Partners State of Independence studies solely focused
on independent workers who, on average, work more than 35 hours/week as
independent workers. We focused on these “solopreneurs” to better understand the
backgrounds, behaviors and attitudes of people who actively engage in independent
work, spend a substantial amount of time as independent workers and derive a
significant amount of income from independent work.
This year we chose to expand the census of independent workers to also include
independents regularly working part-time “side-gigs” alongside their traditional
jobs, retirement and/or family care activities on a recurring basis. We added
these “Side-Giggers” to better understand the role they play in the economy and
their likelihood of becoming more committed to independent work in the future.
In the section below, we will highlight and intersperse key findings for both the
“solopreneurs” and the “Side-Giggers”, drawing on a wider data set as compared to
prior year reports.
Source: http://info.mbopartners.com/rs/mbo/images/2014-MBO_Partners_State_of_Independence_Report.pdf
2014-MBO Partners State of Independence Report: Key Findings
For the fourth year in a row, the ranks of independent workers grew while hurdles to working solo got a bit easier to manage. But what’s going on under the hood? What are the defining measures for success as an independent and what do they mean for the workforce in America?
Summary Highlights Include:
• Independent workers continue overall to be satisfied with their path. Independent workers’ satisfaction remains strong, with 82% reporting that they are either highly satisfied (63%) or satisfied (19%) with their work style. Only 7% reported being dissatisfied. The vast majority plan to continue as independent workers, with 76% indicating they will either continue as solopreneurs (61%) or build a larger business (15%). All of these numbers are consistent with prior years.
• Despite the economic recovery and a much stronger traditional job market, the number of independent workers continues to grow. The number of solopreneur workers, those committed to the independent work path, rose to 17.9 million in 2014. This is up from 15.9 million — 12.5% — since our base year study in 2011. This growth, which is substantially higher than the 1.1% growth in the overall U.S. labor force during the same period, indicates a continued, structural shift towards independent work.
• Independents make a clear and positive economic impact on the US economy. Solopreneurs generated about $1.1 trillion in total income in the past year. They also spent more than $150 billion on non-payroll/contractor expenses. These independents earn income both globally and locally: About 1 in 8 do business overseas generating roughly $38 billion in exports while a robust $710 billion came from their metro areas. A little more than 10 million U.S. households receive at least half of their income from independents.
• Independents hire other independents. Although the vast majority of independent workers are solopreneurs and don’t have traditional employees, they don’t work alone. During the past year, 38% of solopreneurs spent a total of $92 billion hiring the equivalent of 2.2 million full-time workers via contract hiring.
• One in seven independents plans on building a bigger business. A little more than 2.5 million solopreneurs plan to launch larger businesses. These nascent entrepreneurs will build businesses that will create additional traditional jobs and spur greater economic activity.
• The challenges of independence felt more manageable over the past year. Independent workers are acutely aware of the risks and responsibilities they face. In particular, they feel challenged by their uncertain income stream (57%), concerns about retirement (38%) and worries about a lack of job security (34%). Yet, while navigating these challenges is a natural part of this work path, the perceived burdens and challenges of independence have slightly but consistently declined from the base year of 2011.
• Women and men have different reasons for being independent. Men and women choose to be independent at nearly identical rates, have similar satisfaction levels and plan on staying independent at similar rates. They also have consistent views on the challenges associated with being independent. But there is one area where men and women differ: they have different reasons for being independent. Women tend to be more interested in flexibility and developing fulfilling work that fits into their lifestyle. Men tend to focus on being in control, being their own boss and maximizing their income.
• Independents use multiple revenue streams to reduce risk. Most solopreneurs (60%) have more than one revenue generating activity, with 19% having either a full (4%) or part-time (15%) traditional job. Those with multiple revenue generating activities and jobs report doing this to have a steady source of income, which reduces their overall financial risk.
• Part-time Side-Gigger independent workers are focused on supplementing their income. In 2014 we expanded on three years of survey research to include not only the solopreneurs who, on average, work full-time, but also “Side-Giggers”— independent workers who work regularly as independents but do so on a part-time basis alongside traditional jobs, retirement or family care activities. 12.1 million Americans fit this description and share many attributes with their 17.9 million solopreneur colleagues. But while flexibility, autonomy and control are the key reasons solopreneurs
choose this path, most Side-Giggers (58%) are working as independents primarily to supplement their income. A little more than 40% also report they do what they love which may result in a more committed solo business in the future.
• The independent workforce will continue to grow. Given the structural shifts in the economy, sustained interest in control over one’s career/personal life, and lowering hurdles to entry, the solopreneur workforce is forecast to grow to 24.5 million by 2019. When we add today’s Side-Giggers into the fold, we expect the number of active, self-realized independents to grow from 30 million today to nearly 40 million by 2019.
Source: http://info.mbopartners.com/rs/mbo/images/2014-MBO_Partners_State_of_Independence_Report.pdf
Summary Highlights Include:
• Independent workers continue overall to be satisfied with their path. Independent workers’ satisfaction remains strong, with 82% reporting that they are either highly satisfied (63%) or satisfied (19%) with their work style. Only 7% reported being dissatisfied. The vast majority plan to continue as independent workers, with 76% indicating they will either continue as solopreneurs (61%) or build a larger business (15%). All of these numbers are consistent with prior years.
• Despite the economic recovery and a much stronger traditional job market, the number of independent workers continues to grow. The number of solopreneur workers, those committed to the independent work path, rose to 17.9 million in 2014. This is up from 15.9 million — 12.5% — since our base year study in 2011. This growth, which is substantially higher than the 1.1% growth in the overall U.S. labor force during the same period, indicates a continued, structural shift towards independent work.
• Independents make a clear and positive economic impact on the US economy. Solopreneurs generated about $1.1 trillion in total income in the past year. They also spent more than $150 billion on non-payroll/contractor expenses. These independents earn income both globally and locally: About 1 in 8 do business overseas generating roughly $38 billion in exports while a robust $710 billion came from their metro areas. A little more than 10 million U.S. households receive at least half of their income from independents.
• Independents hire other independents. Although the vast majority of independent workers are solopreneurs and don’t have traditional employees, they don’t work alone. During the past year, 38% of solopreneurs spent a total of $92 billion hiring the equivalent of 2.2 million full-time workers via contract hiring.
• One in seven independents plans on building a bigger business. A little more than 2.5 million solopreneurs plan to launch larger businesses. These nascent entrepreneurs will build businesses that will create additional traditional jobs and spur greater economic activity.
• The challenges of independence felt more manageable over the past year. Independent workers are acutely aware of the risks and responsibilities they face. In particular, they feel challenged by their uncertain income stream (57%), concerns about retirement (38%) and worries about a lack of job security (34%). Yet, while navigating these challenges is a natural part of this work path, the perceived burdens and challenges of independence have slightly but consistently declined from the base year of 2011.
• Women and men have different reasons for being independent. Men and women choose to be independent at nearly identical rates, have similar satisfaction levels and plan on staying independent at similar rates. They also have consistent views on the challenges associated with being independent. But there is one area where men and women differ: they have different reasons for being independent. Women tend to be more interested in flexibility and developing fulfilling work that fits into their lifestyle. Men tend to focus on being in control, being their own boss and maximizing their income.
• Independents use multiple revenue streams to reduce risk. Most solopreneurs (60%) have more than one revenue generating activity, with 19% having either a full (4%) or part-time (15%) traditional job. Those with multiple revenue generating activities and jobs report doing this to have a steady source of income, which reduces their overall financial risk.
• Part-time Side-Gigger independent workers are focused on supplementing their income. In 2014 we expanded on three years of survey research to include not only the solopreneurs who, on average, work full-time, but also “Side-Giggers”— independent workers who work regularly as independents but do so on a part-time basis alongside traditional jobs, retirement or family care activities. 12.1 million Americans fit this description and share many attributes with their 17.9 million solopreneur colleagues. But while flexibility, autonomy and control are the key reasons solopreneurs
choose this path, most Side-Giggers (58%) are working as independents primarily to supplement their income. A little more than 40% also report they do what they love which may result in a more committed solo business in the future.
• The independent workforce will continue to grow. Given the structural shifts in the economy, sustained interest in control over one’s career/personal life, and lowering hurdles to entry, the solopreneur workforce is forecast to grow to 24.5 million by 2019. When we add today’s Side-Giggers into the fold, we expect the number of active, self-realized independents to grow from 30 million today to nearly 40 million by 2019.
Source: http://info.mbopartners.com/rs/mbo/images/2014-MBO_Partners_State_of_Independence_Report.pdf
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