A Forbes’s research shows that the 42 million contractors, consultants, freelancers and side-giggers who make up the independent workforce span demographics, age ranges, genders, skill sets and income levels. This workforce includes all segments of the economy — from on-demand drivers to freelance writers, and finance professionals to IT consultants and web designers.
But there’s a particular segment of this population who choose to pursue self-employment not only for the lifestyle and professional benefits it offers, but because it allows them to apply their industry-specific expertise to long-term, high-billing projects: independent professionals.
Independent Professionals: Who Are They?
Independent professionals perform strategic medium- to long-term projects that typically run more than one month and bill over $10,000. These workers generally work with no more than four companies or clients at any given time for an average of about three years.
Compared to the run-of-the-mill independent worker, independent professionals tend to be slightly older and better educated, and have higher incomes. Like many other independent workers — entrepreneurs, freelancers, consultants — independent professionals operate as their own business. They are experts in their industry, openly market their particular services and determine when and how they work.
Work Priorities: Independent Professionals Versus Traditional Employees
Getting personal satisfaction from work is very important to independent professionals. In fact, that’s why so many turn to self-employment in the first place — working independently allows them to turn their passion into a career.
Independents tend to be more confident in the value of their skills and choices than traditional employees, a trait that bodes well for a business model that relies on self-promotion. Independents also prefer to be in charge: 64% of men and 53% of women who are independents say they don’t like answering to a boss, compared to less than half of traditional employees. Given these values, it’s not surprising that independents prefer to work with clients who respect their skills, give them control over their schedule and treat them as members of their teams.
Independent professionals are experts in what they do, and as such they tend to have a lot of choice when it comes to choosing who they work with. According to research we conducted this year, 46% of independents say they have a lot of choice when it comes to picking their clients, and 36% say they have some choice. Because they have such control over the clients they work with, the large majority of independents say they are very satisfied with their client relationships.
Independent professionals also value work processes. They expect that clients will respond to their questions, provide an efficient onboarding process and offer fast payment terms. The No. 1 factor that drives satisfaction, however, is communication. Defined project goals and objectives, timely feedback and a clear project scope are must-haves for each high-value project they choose to attach their reputation to.
Positioning Your Organization as a Client of Choice
Today’s labor market is tight, and it is particularly hard for organizations to find specialized talent for in-demand roles. In fact, 45% of global employers say they can’t find the skills they need, and that number jumps to 67% for large organizations.
As more American workers are choosing the route of independent work due to the lifestyle and professional benefits it offers, it is increasingly making more and more sense for businesses to engage independent talent on a short-term or project basis. However, it is competitive to find, attract and keep this type of talent. In order to become what we call a client of choice (that is, independent professionals’ first choice in client to work with), companies must meet independent workers on their own terms by offering competitive pay and providing a meaningful and enriching work environment.
While there is no specific range for competitive independent contractor pay, as each individual will bring specific expertise, ability and experience to the table, payment terms should be aligned with market standards as much as possible. In order to determine if independent worker rates are in line, the full-time equivalent (FTE) can be used as a guide. To calculate this range, take the FTE hourly rate for a low-skilled role and add 30%. Then, multiply the FTE hourly rate for a highly skilled role by 2.5. The independent worker’s rate should fall somewhere in between the FTE equivalent and 2.5 pay rate. Keep in mind, however, this is simply a rough guideline to provide a basis for comparison; contractors will typically present their own rates and be able to articulate the value of their services.
When it comes to creating a positive work environment, efforts must be made at the very beginning of a contractor-client relationship. For example, it is important that independents understand how to work with an organization and what is expected of them during the engagement process. To create a streamlined transition, require hiring managers to proactively communicate program processes and procedures to independents at the start of the engagement. Creating a client-branded welcome site can be helpful as well. The site can contain education for independents regarding what to expect during vetting and engagement, initial self-assessment surveys, and roles and responsibilities. Throughout the life of a contract or project, require managers to report on high-value deliverables so independents feel appreciated and can see how their work is making a difference.
As millions of workers continue to build careers as independent professionals, more businesses will gravitate toward this workforce to maintain staffing agility, gain access to in-demand skills and easily re-engage talent without adding to their payrolls. By forming meaningful and productive relationships with independent professionals, organizations can satisfy the needs of independent workers, become preferred organizations and reap the benefits this pool of talent provides.