Entrepreneurialism is fundamental to capitalism. Rainer Zitelmann, PhD, a scholar who has studied capitalism in depth, suggests the connection between the two is so strong that capitalism should be rebranded “entrepreneurial economics.” Our own work has involved articulating and following a practice we call inclusive capitalism, which re-funnels the prosperity created through investment into long-term improvements across such areas as infrastructure, education, housing and technology, to benefit the broadest swath of people. Here, we’ll discuss the mindset behind entrepreneurialism, the growth engine for capitalism, as viewed through research we’ve been doing on the U.S. Gig Economy and this free-thinking segment of the American workforce, currently comprising an estimated third or more of all its workers. Through our research, we’ve discerned a set of characteristics which appear to be shared by the gig workers we talked to.
Free-thinking entrepreneurs are the heartbeat of capitalism
For Many Gig Workers, Government Initiatives To Help, May Hinder
There’s been a movement on the part of government at both state and federal levels to reclassify gig workers as employees. Originally directed at lower-paid independents such as Uber drivers and delivery people, first the State of California and then the U.S. Department of Labor proposed legislation aimed to give these workers protection from the companies that were underpaying or otherwise mistreating them. Recently New York State followed suit, proposing a bill classifying workers as employees unless “the worker is free from the control of the hiring entity, the work performed is outside the hiring entity's bailiwick, and the worker is ‘customarily engaged’ in the type of work he is hired to do.” This article calls California’s A.B. 5, which passed in September 2019 “ruinous” while terming the proposed New York bill, S2052, a “crackdown on independent workers.”
While the intentions may be honorable—"… in many cases… employers misclassify their employees as independent contractors, particularly among our nation’s most vulnerable workers,” the U.S. Labor Secretary noted—the sheer complexity of language and mass of bureaucracy these new laws carry would mean a raft of new regulations for employers and, at best, deep confusion for the independent workers they’re trying to help. Bottom line: many gig workers would be likely to view these interventions as intrusive, cutting into their self-honed, entrepreneurial approach to earning and finance and, more importantly, their flexibility and freedom.
Here let’s briefly review the range of Americans we talked to who term themselves gig workers: 53 percent are male, 47 percent are female; 51 percent of them earn over $50,000 a year through gig work, and close to half of those people earn over $100,000; a third of them are single, and two-thirds in a relationship; 61 percent have attained a higher education degree. It’s not hard to imagine that many of these high earners have gotten where they are by starting their own businesses—a foundation block of entrepreneurship. The gig workers we surveyed self-ascribed to working in 18 different sectors we offered, in addition to ones we didn’t. Simply stated, this is a difficult group to classify.
Flexibility and Independence Over All, Including Security
And yet, there’s a common thread running through all these disparate groups. Even with the need for leveling-up solutions to the gig workers’ long-term financial and social problems coming into focus, we detected a fierce independent mindedness throughout the gig economy data, as well as a strain of pride in the choice to become or remain an independent worker. One person told us: “The best thing about gig work? Oh, definitely the independence of it.”
With more than half (53 percent) of our study respondents saying that not having a boss is the most attractive aspect of gig work—a figure that rises to 63 percent among non-office workers—there is a sense of purpose and moral choice that sometimes overtakes necessity among many freelancers. One freelancer we talked to liked “being my own boss and controlling what work I do and when I work.” Sixty-one percent of our respondents said that time flexibility—being able to work when they want to—was the most important factor in their decision to step off the corporate ladder in favor of gig work.
Less than 10 percent of independent workers said they had any interest in the idea of returning to a traditional workplace to advance their career. For 11 percent, there were ethical issues connected with corporate America, and another 19 percent said they couldn’t work in a corporate setting or a traditional employer-employee setting. Even as companies develop a sense of purpose beyond mere profit, a large percentage of American gig workers are obviously reflecting this trend in microcosm. When asked how they prefer to spend their time earning a living, they land hard on the side of purpose, individualism and free thinking.
“Live Free or Die”
Some of the gig workers we surveyed in our research even belied a libertarian leaning, first given an American flavor in Revolutionary patriot Patrick Henry’s 1775 circular Give Me Liberty or Give Me Death. In a few cases, gig work appeared to be more of a moral choice than a necessity. When asked the question, Which financial security benefits do you wish you had?, one freelancer replied: “A fiscally responsible government and energy independence from other countries.” Another wrote us, all in capital letters: “NOTHING GOVERNMENT CONTROLLED.”
Which brings us back around to the state and federal attempts to codify these workers and how those who employ them should treat them. U.S. policymakers are clearly taking notice of the growing gig economy and trying to enact changes which, on the face of it, are intended to protect these workers from exploitation. Is this inclusive capitalism or, as some gig workers hold it, a new level of state control? Lawmakers and employers alike will have to strike a balance between offering a safety net to this free-thinking worker population and maintaining those same freedoms that motivated them to work independently in the first place.
With the ranks of freelancers growing, large employers will clearly have to take a good hard look at what they are offering both their salaried workers and their freelancers, beyond a steady paycheck. The labor environment is changing, and the private sector, which is increasingly trying to become more agile, needs to change with it.
