What Shape Will Work Take?

Here is an interesting story on where jobs may be headed.

Ken Gaebler can help explain how the U.S. economy can be growing so briskly without adding significant numbers of new jobs. When Gaebler's three-year-old marketing firm needs a computer programmer, a speechwriter, a Web designer or just about any other work done, Gaebler doesn't take out a help-wanted ad. He puts the project out to bid on the Internet.

Gaebler recently hired a man in Ukraine to design a computer system to monitor sales results. Gaebler paid him $118, much less than the $1,000 he figures he would have paid a freelance American programmer. Gaebler paid by credit card and earned frequent flier miles on the transaction. Gaebler's Chicago firm has grown to nearly $1 million in sales with only three full-time, traditional employees.

"So many talented people that I worked with in the past are available for freelance work," Gaebler said. "These are people who used to make $150,000 per year, and now they are freelancing and pulling in $60,000 to $70,000 while they wait for the economy to turn around."

It may be that the economy has already turned around and that Gaebler's personnel policies are among those that will help define this expansion: an era when the creation of permanent, full-time jobs will be tamped down by the global availability of work-for-hire independent contractors.

More than two years into the recovery from the last recession, coming off a quarter with sizzling 8.2 percent growth in the gross domestic product, the U.S. economy has created only 278,000 new jobs in the past five months -- leaving the nation's total number of payroll jobs 776,000 lower than when the recovery began.

"It's a new kind of workforce," said Paul Villella, chief executive of HireStrategy, a Reston-based recruiting firm. About 64 percent of the people his firm found work for last year accepted jobs as independent contractors, up from 28 percent in 2000. He described the job seekers as mostly accountants and software engineers.

While economists agree there is more self-employment, they disagree about whether this is a temporary adjustment that will soon give way to more robust growth in traditional jobs, or a lasting change in the nature of work and the relationship between employer and worker. The answer to that question matters greatly to presidential candidates vying for office during a "jobless recovery," as well as to Federal Reserve officials who must decide how long to leave interest rates at a 45-year low.

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