Can Full-Time Tech Workers Survive the Gig Economy? (dice.com)

Nerval's Lobster writes: By some measures, more than 40 percent of U.S. workers will be independent in 2020. Today, that number stands at 34 percent, according to the Freelancer's Union. By all accounts, the trend seems widespread enough to indicate that tech pros should prepare themselves for the dynamics of a world that depends more on contingent work. The question isn't whether the tech world will see an increasing prevalence of 'gigs,' rather than full-time positions; it's whether those in full-time positions can easily keep their jobs when there's pressure to farm it out cheaply and easily to freelancers. Or will the need for people who can see projects through the long term prevent the 'gig economy' from radically changing the tech industry?

Comments

Look at the bean counters for your answer

[BarbaraHudson]

Permanent staff are seen as a burden. They will look for any way to reduce that, so long as their (or their bosses) jobs are not the ones affected.

Re:Look at the bean counters for your answer

[volcan0]

I think you make a valid point. Super easy to get around: Start outsourcing bean counter's job as well. I am sure we will see the trend reverse itself right away.

Re:Look at the bean counters for your answer

[rubycodez]

a big correction is coming, outsourcing mission critical systems can end very badly, especially if it involves countries with huge black markets for stolen data with no real legal venue to pursue. yeah India is prime example of what I'm talking about, and if you farm out to any former soviet country their mafias will make a killing on your data too (as aside sometimes that's not a pun)

Re:Look at the bean counters for your answer

[Anonymous Coward]

The beancounter is the one doing the outsourcing though. You really think that they're going to sack themselves? More likely they'll give themselves a nice big bonus for all the "efficiencies" they've achieved, then retire early before the company tanks as a result of all the people who actually make/understand the product vanishing.

Re:Look at the bean counters for your answer

[Zero__Kelvin]

"A big correction is coming ..."

FTFY (but, really, it wasn't a very big correction after all.) Here is some additional helpful information.

Re:Look at the bean counters for your answer

[silas_moeckel]

Your forgetting a few rules of consulting. Rule one never look like one of them dress above or below them. Rule two your a business gig is by definition short term work charge in accordance with that you should be billing several times what their internal people make. Rule three it's the contract stupid as the vendor you should be the one putting out the initial terms and negotiating from there.

Re:Look at the bean counters for your answer

[Darinbob]

It's not just about security though. Outsourcing does not give you workers who care about your company. Their transients, a few bugs won't bother them. A security hole isn't worth patching. Billable hours is the only thing that will matter. Your company is trying to make something new and unique and the guy at the other end of the phone says "yes, sure, we can do that, we're the expert in that!" and then 24 months later they've vanished and you've got nothing to show for it.

Then the workers will want to start standardizing so that they can migrate their jobs more easily, requesting that certificates take the place of interviews and evaluations.

Re:Look at the bean counters for your answer

[khasim]

I have to explain that to people all the time.

To an employee, you are a paycheck / insurance / vacation-time / etc. If they fuck up they have to go through the interview process to replace those items. And it is in their best interest to do the job correctly so they don't have to deal with the problems or the hassle of interviewing.

To a contractor, you are billable hours. If they fuck up they have to find replacement billable hours. That's it. They don't care whether it works right because they can charge to fix it. Again. And again. If they find a customer who pays better, you'll be on your own. Unless you want to cough up more money.

Re:Look at the bean counters for your answer

[whoever57]

You forgot the other rule:Have a spouse in a full-time gig with medical benefits.

Once those contractors hit 50+ years old, if they have families and have to buy their own insurance, those consulting gigs are going to look like poor deals.

Re:Look at the bean counters for your answer

[ranton]

After spending time as both a full time employee (FTE) and consultant, I find the dynamic can quite often be the opposite of what you describe.

To an employee, you are a paycheck / insurance / vacation-time /etc. If they do a great job they will get the same paycheck as if they do a mediocre job. Maybe they will get an extra 1% raise. As long as they don't royally fuck up, they will not get fired. As Peter Gibbons put it, an employee relationship will "only make someone work just hard enough not to get fired."

To a contractor, you are a gold mine. They can make enough in 4-5 months to match what an FTE gets in a year, even counting benefits. And their ability to get more of these gigs in the future is mostly dependent on making each client happy. If they do a great job, instead of a 1% raise they get another 1000 billable hours at $225 each. This is quite the motivation to do a great job.

Both your scenario and my scenario happen. Finding a great employee and a great consultant are both rare and incredibly valuable.

Yeah...

[koan]

%40 I don't think so...

I guess I've read too many political articles and everything now smells like an ad, a conspiracy or outright propaganda.

"Carolyn Ockels: Carolyn is the Managing Partner at Emergent Research. Carolyn's current research and consulting is focused on economic decentralization"

Focused...

If the town was burning

[Squiddie]

These bozos wouldn't stop to wonder if this was the new normal. This is as sickening as financial analysts marveling at the possibility that the US as a nation of renters rather than homeowners could be the "new normal."

Dice "insights"

[grimmjeeper]

The article seemed to be far fetched. It all made sense when I looked up and saw that it's just another idiotic dice "insights" spam.

Institutional Knowledge

[The Raven]

On a site that frequently ridicules the short-sighted behavior of eliminating experienced employees to bring in fresh (cheap) college graduates, it seems out of place to have a positive outlook on pervasive outsourcing.

If everyone is a contract worker doing works-for-hire, then nobody has extensive institutional knowledge. You are constantly explaining and re-explaining how your business works, and bugs are repeatedly entering codebases because the developer hasn't spent years understanding the business and its workflows. It doesn't matter how well documented your business is, developers will make mistakes when they are unfamiliar with your processes. When they can't look at a workflow or data structure and go 'that's not right' because they have spent years at the company learning how things work.

Experience has value; not just experience coding, but experience with the company understanding how it works. Systems are rarely generic... they are embedded directly into the business logic unique to each company, and the less you need to learn and relearn the requirements of every system the more productive you can be.

Re:Institutional Knowledge

[Zero__Kelvin]

"Experience has value; not just experience coding, but experience with the company understanding how it works. Systems are rarely generic... they are embedded directly into the business logic unique to each company, and the less you need to learn and relearn the requirements of every system the more productive you can be."

Everything you wrote is spot on. I recently witnessed this very thing happen. A company I know of was outsourcing their development to an eastern block company and they just couldn't do it. It should have been obvious, as the system they have is literally infested with custom business logic, and that business logic is by no means standard, typical, or intuitive. In this case the intent was to develop some in-house software further by outsourcing to people with no understanding of the company, and they thought it would work, because Agile! Seriously! It is sad that such a large section of today's software development community seem to lack an appreciation for having a forest, tree, and root perspective on the product(s) and company, and actually thinks Agile is a viable Engineering methodology. It's pitiful.

Re:Institutional Knowledge

[Anonymous Coward]

It is sad that such a large section of today's software development community seem to lack an appreciation for having a forest, tree, and root perspective on the product(s) and company, and actually thinks Agile is a viable Engineering methodology. It's pitiful.

I think it's important to emphasize that almost without exception it's the management, and not the engineers, who fail to understand this. It should be simple, but apparently the MBA brain has great difficulty wrapping itself around it. Personally, I think that business schools, which promote the idea that any business can be understood according to simple "universal principles" (aka the 10 minute manager) without recourse to critical thinking or real world experience, are a big part of the problem, but I digress. With regard to outsourcing, I like to put it to MBAs like this: If the core of your business (aka the "secret sauce") can be outsourced then you don't really have a business that's special or even worth doing. At that point you're just a price taker in competition with other me-too firms for the lowest bid and that's not a business you want to be in. Instead, you want to be in the business of selling a unique and high value product or service, one which cannot be easily imitated or substituted, and doing it better than anyone else. If such a business could be outsourced then everyone would be doing it and it would no longer be unique, special or profitable.

At-Will Employment

[Moof123]

We are all temporary employees for the most part. I was told I was likely to have 6-7 jobs in my career, and less than halfway through I am on employer #7.

The gigs might be getting shorter, but we have lived in a hire/fire economy for a couple decades now. Hire when you need folks, and cut them loose when you don't. Nothing new here. There are a lot of headaches with contractors that having employees actually avoid, namely the need to actually plan and think out a chunk of work before throwing warm bodies at it.

Personal experience, rough on families

[Tablizer]

I used to "gig around" a lot, and found it difficult to co-raise a family under. If you are single and can hop all over the country and/or globe, that's great! But it's hard on families.

During good times you may be able to stay mostly local, but good times rarely last. The boom/bust "business cycle" of capitalism has been going on long before the USA existed, and has yet to be solved.

If gigs paid very well, then perhaps one could live with more gaps by saving up. But I have not seen a significant lasting pay advantage, especially during recessions.

Maybe a few "elite" workers with speedy eyes and eidetic memories can pull it off and come out ahead of traditional salaries, but by definition, most of us are not elite.

Full-time permanent is required

[Todd Knarr]

Having been on the permanent-staff team dealing with contract workers, I can't see permanent staff ever being replaced by "gig" developers. A lot of things depend on having not just skill in programming but familiarity with the business and prior decisions about the system's design and architecture. You can hire short-term people for specific tasks, but you need people who've been there long-term to work out how to fit new requirements into the system as it exists. Then there's maintenance. Bugs that make it into production tend to be obscure and hard to trace, and someone new who isn't intimately familiar with how things fit together's going to be completely lost trying to troubleshoot a bug that's not in any component but in the interaction between 3 different components (or worse, a bug caused by all 3 components being absolutely correct and bug-free but that particular account's so old it has a combination of settings on it that isn't currently legal and that the documentation doesn't mention).

The permanent staff won't be the cheapest in absolute terms, but they'll be the cheapest in terms of dollars spent for results produced. This isn't a guess, it's a prediction based on the outcome of the vast majority of attempts to replace permanent development teams with contract workers and consulting firms.

Re:Full-time permanent is required

[dbIII]

Just because it's a bad idea doesn't mean it doesn't happen. Sometimes "the numbers" look good so people do it to progress their careers at the expense of their employer. A steelworks I worked at for a three month gig as a contractor went that way and they managed to go from record profit to completely shut down in under three years - but "the numbers" were good. Tons of steel per permanent employee hour was up through the roof - but so were costs.
In software terms I'm using a package where permanent staff were laid off and contractors were brought in to do a complete rewrite in 2003. They've updated the GUI but not much else in the twelve years since. Last I heard the contractors were working out of Pakistan, maybe India was costing too much?

Even the blind hog

[rsilvergun]

finds the acorn now and then (and yes, I know Hogs hunt by smell, it's an expression, roll with it).

They're probably trying to dance around the real issue, which is that there isn't going to be enough work for all us tech workers. With all the outsourcing and H1-Bs and what have you. That plus the "Gig Economy" is a fancy way to say companies don't want to pay for benefits, paid leave and pay raises. It's basically a massive pay cut on a scale that I don't think has ever happened. You don't really want to bring that up because if you think you're having a hard time swallowing these "insights" imagine what accepting the brutal reality of the "Gig Economy" is like...

But I don't want to be an employee

[Anonymous Coward]

Trust some entity to be my only source of income? No thanks. I'd rather have 2-3 income streams... they're not likely to shut down all at the same time.
If you like your employee status you expose yourself to the whims of MBAs. Not a good idea.