RMIT FORWARD
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RMIT FORWARD

Navigating The New Freelance Economy

Photo by Ave Calvar Martinez

Pete Cohen, development partner at FORWARD — The RMIT Centre for Future Skills and Workforce Transformation — writing with director Peter Thomas and development partners Sally McNamara, Inder Singh, Kate Spencer and Courtney Guilliatt on the future of freelancers and freelance skills.

My dad started his career as a primary school teacher in the early 1970s. He retired last year after nearly 50 years with the same employer.

It was the same for most of his generation — a long, stable, and linear progression through a single profession — possibly even with the same employer, as in my dad’s case.

But for work, the future will not look like the past.

One reason is that jobs, organisations — and indeed many industries — simply won’t exist in a stable form for decades as they have in the past. With the increasing rate of acquisitions and widespread disruption to industries across the economy for many reasons, including automation and digitalisation, it’s increasingly likely that people will change their job several times throughout their life, whether they like it or not.

Another reason is that there are simply more opportunities to explore. People have always chosen to be business owners, entrepreneurs and freelancers.

However, we should now anticipate a continuation of the trend toward people becoming their own boss — either out of necessity or because there is less friction to giving it a try. Setting up a business is easier than ever before, especially since internet businesses are cheap to set up and easy to scale without the cost of owning equipment or premises.

This transition won’t be the same for everyone

I recently took a leap into a portfolio career.

After 10 years in a stable, full-time job, I now make my living through a combination of part-time employment contracts and freelancing through my own company.

New generations of workers may never even enter any kind of traditional employment. For example, the people coming together to build the emerging web3 infrastructure and applications are doing so via digital talent platforms or distributed autonomous organisations (DAOs) such as dOrg or Superteam, not via employers. They focus on projects, community and shared upside, rather than having a mindset of being an employee working for a fixed wage. As the Superteam homepage says:

“We value the sovereignty that comes with founding a company, the skin in the game that comes with investing, and the joy that comes with getting sh*t done. In a pre-crypto world, we had to fit into broiler categories — founder, investor, or employee. Crypto allows us to be free-range and be all 3 at the same time.”

It’s not just one job

While the path to self-employment may differ from person to person, one thing remains consistent — a shift in where responsibility lies.

In a traditional employment arrangement, the employer carries more of the responsibility and risk by providing a stable income and benefits such as sick pay or professional development. The trade-off that employees typically accept is a lower level of pay and less flexibility compared to what they could get as a freelancer.

Freelancers, on the other hand, need to balance being responsible for delivering their work as well as everything that goes along with running a business — ensuring a steady stream of income, insurance, invoicing, and having a financial safety net both for the short and the long term.

This requires the honing of two distinct skillsets — the skills that the freelancer uses to create value in exchange for income and the skills that are required to run a business.

Both of these skillsets are evolving rapidly.

Navigating complex decisions

For example, think about an (imaginary) freelance graphic designer, Sarah.

Ten years ago, her work was focused on web and print, with clients relying on Sarah’s expertise in using expensive and specialist tools. Her client relationships were direct and long term.

However, since the rise of tools like Canva, the tools of the graphic design trade are much more accessible. Sarah’s client can now do much of the graphic design work in-house and outsource simple jobs to cheap freelancers on platforms like 99 Designs.

But the needs of Sarah’s clients have also evolved from just graphic design to digital marketing that spans multiple channels, such as video and animation. And, of course, new opportunities are starting to emerge for Sarah to engage in web3 using tokens or cryptocurrency rather than cash.

So ask yourself:

  • What new skills does it make sense for Sarah to invest in?
  • How and where should she get her training?
  • How does her business model need to evolve in response to these changes and opportunities?
  • Does it make sense for Sarah to try and acquire all of the necessary skills, or is going to be more effective to partner with other people to cover the complexity of the work to be done?
  • What are the implications from an insurance and tax perspective from Sarah being paid in cryptocurrency rather than traditional cash?

The responsibility sits with our freelancer Sarah to work out the answers to these complex questions. If Sarah worked for a traditional employer there would likely be specialists within the business who would have done the research for her and helped her respond.

The future of freelance skills — and maybe the future of skills

At FORWARD, we are exploring the future skills landscape — not only what skills will be required in the future, but what will be the context surrounding them and how can they be acquired.

While the pandemic suppressed self-employment, as it did all forms of employment, evidence suggests that following the pandemic, recovery in employment levels has been stronger for freelancers and self-employed workers who have emerged from the economic turmoil ready to get back to work. Even if the numbers of freelancers are not exploding yet, it is likely that in the backwash of the pandemic, we will see a rise in the number of freelancers from the current estimate of around 25% of the Australian workforce.

While some of the implications are economic — such as how are freelancers taxed, what are their entitlements (if any) from those that employ them, or what are their workplace rights — there are also implications that are more far-reaching. These are around how freelancers, like our designer Sarah, can upskill themselves, and how freelancers can create networks of support.

We think the rise of freelancing is a significant trend that, as a society, we need to prepare for. So at FORWARD, we are exploring the benefits of a Co-operative Freelancers Society (CSF). CSF is a human-centred approach to satisfying the needs of freelancers who, in general, do not enjoy the same benefits and safety nets that employees do.

The CSF brings freelancers together in a self-governing member-owned cooperative, which may be a DAO, to share resources and knowledge. At the same time, CSF provides access to bundles of services provided by partners — such as finance, insurance, legal advice, education or skills training.

On Friday 24 June 2022, we will be hosting a panel event called Networking The Gig Economy — options for the future of work.

We will explore questions including how freelancing will evolve in the future, some of the challenges facing freelancers and some potential solutions to those challenges.

Our panel will also explore new ways that freelancers can come together, and find out if emerging technologies and concepts including web3, tokens and DAO (Digital Autonomous Organisations) could provide some infrastructure to make that happen.

We will also start to explore what lessons freelancing can teach us for future skills. Our feeling is that for freelancers, new skills — what they are, where you get them, how you learn them and update them and how you make the most of them — are pressing and important questions, and exploring them will teach us a lot about the broader skills landscape.

If you are in Melbourne and would like to join us, please sign up here.

FORWARD is the RMIT Centre for Future Skills and Workforce Transformation.

Our role is to build an innovative learning ecosystem at scale, create new collaborative applied research and invent next-generation skills solutions that will catalyse workforce development in the future-oriented industries crucial to Victoria’s economic renewal.

We lead collaborative applied research on future skills and workforce transformation from within RMIT’s College of Vocational Education, building and scaling the evidence and practice base to support Victorian workforce planning and delivery and acting as a test lab for future skills to develop and pilot new approaches to skills training and education through digital transformation and pedagogical innovation.

We leverage RMIT’s multi-sector advantage to translate research insights into identifying workforce requirements and the co-design of practice-based approaches with industry.

Contact us at forward@rmit.edu.au

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Stories about future skills and workforce transformation from RMIT FORWARD, exploring learning ecosystems and inventing next-generation skills solutions for workforce development. Writers: Pete Cohen, Jane Howie, Sally Mcnamara, Inder Singh, Kate Spencer and Peter Thomas.

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Pete Cohen

Pete Cohen

Systems innovator, collaboration strategist

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