The end of the office… and the future of work

By Drake Bennett

By the end of the month, a company called txteagle will be the largest employer in Kenya. The firm, started in its original form in 2008 by a young computer engineer named Nathan Eagle and, as of this coming June, based in Boston, will have 10,000 people working for it in Kenya. Txteagle does not rent office space for these workers, nor do the company’s officers interview them, or ever talk to most of them.

And, in a sense, the labor that the Kenyan workforce does hardly seems like work. The jobs – short stretches of speech to be transcribed or translated into a local dialect, search engine results to be checked, images to be labeled, short market research surveys to be completed – come in over a worker’s own cellphone and the worker responds either by speaking into the phone or texting back the answer. The workers can be anyone with a cellphone – a secretary waiting for a bus, a Masai tribesman herding cattle, a student between classes, a security guard on a slow day, or one of Kenya’s tens of millions of unemployed. The jobs take at most a few minutes and pay a few cents each (payment is sent by cellphone as well), but a dedicated worker can earn a few dollars a day in a part of the world where that is a significant sum.

The txteagle story is a variety of things: a tale of savvy social entrepreneurs taking advantage of the proliferation of cellphones in much of the developing world, an example of the ability of clever programming to chop big jobs up into tiny discrete chunks and to assess reliability by checking the answers of different workers against each other. But txteagle is also, at the most basic level, a story of how people are rethinking what work can be.

The United States Government Accountability Office has estimated that so-called contingent workers – everything from temps to day laborers to the self-employed

to independent contractors – make up nearly a third of the workforce. And forecasters believe that proportion will rise. The growth is being driven partly by economic factors, with the uncertain economic climate making short-term contract workers more attractive to firms than full-time employees, but of course broader technological changes are at work as well – cellphones, PDAs, and broadband make it easy to farm out work, even complex, interactive tasks that previously only made sense to do in-house.

This shift has begun to trigger a more fundamental examination of what a job is and what we expect to get from it. Despite the vast diversity of the work people do, the traditional notion of a job has tended to be a standard bundle of responsibilities, roles, and benefits: We do our work for an employer to whom we owe our primary professional allegiance, and that employer pays us and provides us health insurance and a sense of professional identity. In the United States, many of the laws that shape health insurance, retirement, and tax policy are structured around this model.

But in a few realms, people have begun to unpack that bundle and reassemble it in new, surprising, and potentially very important ways. As it becomes easier for companies to plug in on the fly to the constantly shifting network of freelance labor, freelance workers have begun to think not in terms of having a job, but of having a collection of different jobs at any one time. Some companies, like txteagle, are unbundling work in more radical ways, using technology to “crowdsource” labor, to divvy it up into micro-jobs that can be farmed out to unaffiliated masses of remote workers.

At the same time, others have begun to think about the broad social implications of this reshuffling, and to create institutions to fill the gaps that it is opening up. These new institutions, whether clubs, unions, or something more like a medieval guild, seek to provide those benefits – everything from a dental plan to a place to socialize to a sense of identity – that traditionally have simply come with the job.

“In the long term, what we’re doing is building the next safety net,” says Sara Horowitz, the founder of Freelancers Union, a leading such organization with 130,000 members. “In the short term, we’re picking up the pieces of what people need, like health insurance, and helping members have the political clout to make the new New Deal happen.”

The middle of the 20th century was the age of the great employer: Mainstream success was a stable job at a single company, steadily ascending from middle to upper management. That began to change in the 1970s and 1980s, for reasons that were social as well as economic: American conglomerates began to face stiff foreign competition, and the country accustomed itself to – and even began to celebrate – a more mercurial, less cosseted brand of capitalism. The Organization Man was replaced by the worker as free agent, one who might with little regret leave a job when a competitor gave a better offer, or who might be left jobless when his company merged with another. The arc of the average career trajectory grew more fractured.

What we’re seeing today, says Thomas Malone, a professor at the MIT Sloan School of Management and the author of the 2004 book “The Future of Work,” is a further shift. The growing freelance workforce, he argues, is made up of people who see themselves not as having a single job so much as having several at once. To describe the current change, Malone borrows an image that the sociologist Alvin Toffler used to describe the earlier one.

“One of the things [Toffler] said was that we should move from the idea of a career as a linear progression up the ranks in a single organization to that of a career as a portfolio of jobs that you hold over time in a series of different organizations,” says Malone. “What I’m just now realizing is that many people today see their career portfolio including a combination of jobs at the same time.”

Malone believes that new forms of freelancing will help drive this change. Companies like iStockphoto (a stock photograph and image site containing the work of over 70,000 artists), Threadless (a T-shirt design company where anyone can submit designs and evaluate others), and Elance (an online source of skilled freelance labor) are models of companies where not just secondary jobs but the core function of the business is outsourced to a diffuse online workforce. All are helping connect client companies and freelance laborers to each other easily, without a traditional intermediary and with stricter standards than online marketplaces like Craigslist.

These sites allow freelancers to field and respond to far more offers than they would previously have been able to, and to create a far larger and more diverse slate of jobs at any one time. Successful Elance workers often have nine or ten projects going at any one time.

“You can aggregate all these different jobs and clients, and create a portfolio of employers rather than one,” says Fabio Rosati, Elance’s CEO. “The independent professional freelancer has access to many, many more opportunities and can evaluate them without getting in the car or picking up the phone.”

The smaller the job, of course, the more voluminous the portfolio of work has to be. In this sense, the most radical form of freelancing is crowdsourcing, where jobs that previously might have been done by one person are instead “chunked” into much smaller tasks that can be taken up, one by one, by a far-flung army of online workers. The best-known crowdsourcing application, Amazon.com’s Mechanical Turk, pays pennies for tasks like tagging photos or transcribing speech.

A few programmers have started to look at how to expand the possibilities of what sort of work can be chopped up and farmed out in a crowdsourcable way. A team led by Greg Little at MIT created a software toolkit called TurKit that allows the Mechanical Turk crowd workforce to be enlisted to perform more complex tasks like composing text, copy editing, or deciphering illegible handwriting by using crowd members in an iterative manner to go over each other’s work, replicating real-world collaboration.

In computer science and other fields, Little believes crowdsourcing could allow the creation of a whole new category of worker, one with far greater specialization than what professionals have now but who could work on a much larger number of projects, being called in to contribute a much smaller part of the whole.

“Right now I can’t hire a bunch of programmer experts in lots of different domains because I can’t afford to keep them on hand all the time,” he says. “But if I could hire them just for the five minutes I need them, individual people would have the power to create projects that require lots of expertise, and the potential for people to innovate and create things would increase.”

How much a person can make as a member of the “crowd” remains to be seen, of course. Txteagle – along with another company called Samasource that connects Kenyan refugees to crowdsourcing work – has found a population for whom a couple dollars a day is truly helpful. But it’s hard to imagine making a living off of that in, say, Boston.

Other distributed labor market firms, however, follow a somewhat different model, and one that’s far more lucrative for the individual freelancer. Elance offers professional work for professional pay in fields from programming to design to finance to law. Another example is InnoCentive, which allows firms in fields like software and pharmaceuticals and engineering to post problems they want solved – requests for everything from “Biodegradable, Bioderived Elastomers for Medical Applications” to “a novel design for a male showering accessory” – and how much they’ll pay for a solution – usually something in the tens of thousands of dollars – and lets interested parties go at it. Successful solvers can make real money.

Some of iStockphoto’s contributors, too, are able to make a good living. One of the more successful artists on the site is Nicholas Monu, a medical school student at Brown University who, according to iStockphoto, earns a low-six-figure income from his photos and illustrations on the site. “It pays for med school, it pays for my car. iStock paid the down payment on my condo, and it’s paying the mortgage,” he says.

To Malone this shift is, in and of itself, an overwhelming good.

“It’s now possible, for the first time in human history, to have the economic benefits of very large organizations – things like economies of scale – but at the same time to have the human benefit of very small organizations: creativity, motivation, flexibility, and so forth,” he says.

Jobs provide more than a paycheck, though. For most workers, their employer is their source of health and retirement benefits, and for many, the workplace gives a structure to their social life and a shape to their sense of themselves. A shift is already underway with health care: The legislation before Congress could make it easier to get health insurance without relying on one’s employer. But the more workers there are outside traditional workplaces, the more people will have to figure out alternative sources for all of those things.

One of the most basic benefits of a steady job, of course, is a measure of job security. Full-time jobs can always be terminated, as millions of Americans have been recently reminded, but with freelance work, potential unemployment lurks at the end of every short-term contract. A world in which people have more smaller jobs rather than one big one would go some way toward addressing this, smoothing out the ups and downs that losing any one of them would bring.

But to provide a greater level of stability freelance workers may require a new kind of institutional ally. Malone predicts that the growth in freelance work will necessitate a different breed of labor union to provide some of the benefits the employer now offers. Today’s unions are largely defined by their role in collective bargaining – negotiating with employers for better benefits, conditions, and pay. But many early unions actually arose in industries like construction or the garment trade where workers didn’t work for the same employer for very long, so the longstanding relationship wasn’t with the employer but the union.

These unions were more like guilds: organizations, united by a common set of specialized work skills, that combined elements of a social club and a mutual aid society. And rather than pressuring employers to provide benefits, they provided them directly. Malone argues that this sort of guild would be well-suited to a work landscape in which more workers are freelance. Such organizations might even see fit to offer income-smoothing insurance policies where freelancers can in good times pay into a fund that then helps them through leaner periods.

Freelancers Union, founded in 1995 in New York City, models itself along these lines. It provides medical and dental benefits, a retirement fund, and life insurance. It lobbies state governments for freelancer-friendly policies – among its causes right now is a proposal for a tax-advantaged unemployment insurance plan for freelancers.

And it also tries to address some of the less quantifiable difficulties of freelancing. Many freelancers complain that one of the great difficulties of the work is its solitary nature. Some of the online freelance companies try to tackle this. Most have online forums through which they try to recreate some of the dynamics of an actual workplace. iStockphoto goes further, organizing “iStockalypses” for select groups of its photographers: weeklong gatherings in exotic locales worldwide that are part party and part photo shoot. And iStockphoto photographers have begun organizing regional “Minilypses” on their own as a way to pool resources for photo shoots, to share information and simply to socialize.

Freelancers Union’s attempts to knit its members together socially are more conventional. Last month the organization held a holiday party in New York, and 150 or so people showed up. It was, says Horowitz, an enthusiastic crowd. “These people hadn’t been to a holiday party because they had been freelancing for years,” says Horowitz. “They want to feel connected, they want to feel that they’re part of something.”

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