The Freelance Workforce has Exploded!
The temperature is below zero. It’s Monday morning, a few minutes to 9, and I’m on my way to Café K to meet Toby Toudal Nielsen, Director Nordic at Comatch. Toby has been driving since early dawn from the border between Denmark and Germany to meet me for coffee at a small local café in Aarhus, Denmark. Comatch itself is located in Berlin, yet today, like so many other days, Toby is in Denmark to meet with companies and freelance workers alike.
While this is interesting in itself, a staggering 79% of freelancers feel that freelancing is better than traditional employment. To top it off – 50% of freelancers say they would not return to traditional jobs for any kind of money.
Apparently, the freelance workforce has exploded – and I had not even noticed. In just the last two years, America has gained two million more freelancers, now counting 55 million freelancers. This means more than one-third of the American workforce makes a living outside the traditional workforce, as we know it. These numbers are from a recent study done by the American freelancers’ Union. While this is interesting in itself, a staggering 79% of freelancers feel that freelancing is better than traditional employment. To top it off – 50% of freelancers say they would not return to traditional jobs for any kind of money. And why should they? According to the report, they are working fewer hours and a majority are enjoying increased earnings. Clearly, these numbers are exciting as they speak directly to my vision for ManageMagazine of creating greater workplaces. If 43.4 million freelancers have increased their work satisfaction by turning to freelancing from traditional jobs, then surely there are lessons to be learned.
Luckily, I am about to learn more about how freelancers and businesses can best navigate in this new gig economy.
Meeting Toby Toudal Nielsen from Comatch
Toby Toudal Nielsen arrives and we get coffee. He carries a pleasant self-confidence, which makes conversation easy and very enjoyable. With his 20 years of experience from the Nordic marketplace – including a large Danish news publishing House, JP/Politiken, I am excited to learn about his journey. I jokingly try to headhunt him, without any luck, unfortunately. He is kind to ask about ManageMagazine, and I tell him how I feel driven by purpose.
“What drives you in your working life, Toby”?
“Making the job markets more flexible. Even in Denmark, we have a long way to go. Things are moving but at too slow a pace”.
I agree with this. Some leaders still think that desks are small assembly lines and the employee needs to sit there to be of value to the organization. But how can Comatch help the pace of things? Before we move on I ask to be enlightened on how they have set up the business.
Brief Background and Facts about Comatch
Comatch is an online marketplace that matches consultants with organizations by using a secret algorithm. Based in Berlin, Germany, they are a fast-growing organization that will soon celebrate their second year in business. The founders are prior McKinsey consultants, Dr. Christoph Hardt, and Dr. Jan Schächtele, who spotted a changing workforce – a trend worth pursuing for new fine-tuned solutions.
Comatch is growing rapidly, increasing its number of consultants daily and moving across borders – all with a rather young team. Toby, at 39, is the oldest member of the team; a team that is led by eleven managers so far. They opened offices in Amsterdam and Copenhagen in 2016 and are moreover working in the Middle East. As Director Nordic, Toby covers the Scandinavian countries. The general business model enables both consultants and businesses to gain a financial advantage: consultants get good projects and organizations and consultancy houses get adaptable highly skilled professionals.
The following is a Facebook update from Comatch posted in August 2016:
Why Choose to be a Freelance Consultant – Why Choose to Hire one?
I am curious why the freelance consulting workforce is growing so quickly. What is it about freelance consulting jobs that they have become so popular? Surely, the European workforce is different as compared to the American. Yet, reports show that the gig workforce is increasing beyond just steady growth in Europe also. Clearly “freedom” is important to freelancers. Owning your time and deciding when, or when not to work is valuable to balancing the tasks of modern life – especially with kids.
“Yes, freedom and flexibility are important factors,” Toby explains. “The backside of the coin to working as an individual expert is living with degrees of income uncertainty. Longtime lapses in between jobs can soon eat up earnings and reduce a year’s general income”.
“What we offer removes much of this uncertainty”, says Toby, “by providing projects and eliminating time spent between jobs. It is also my experience that spending time applying one’s professional skills is more attractive than finding clients or selling your skills”.
“But it goes the other way too. Client organizations become more prone to using consultants for temporary projects instead of hiring permanently when in need of short-term specific expertise. By using individual consultants or even a team of consultants for a specific project, clients can exchange one type of expert with another depending on their needs at that specific time”.
“At times it must be difficult though, to find the specific expertise you need” – I inquire?
“Well, sure. Yet as the number of consultants working for us is increasing, we rarely have that problem. Our flexibility enables us to offer jobs across borders. A Swedish consultant, for example, can take on a project in Italy if his or her skills are needed there. We also have consultants who are hiring for both shorter and longer working periods on projects in the Middle East.”
The flexibility of freelancing can clearly benefit the consultant as well as the hiring organization. Whether there are some flip sides to this gig workforce such as work-related stress or other we’ll have to return to find out.
I listen with interest and see how this is a completely new way of strategizing an acquisition process. By flexible staffing, I see moreover how Comatch can offer consultancy houses the opportunity to explore new markets and sectors in a rather risk-free manner. The flexibility of freelancing can clearly benefit the consultant as well as the hiring organization. Whether there are some flip sides to this gig workforce such as work-related stress or other we’ll have to return to find out. Technology has clearly played an important role in the surging gig markets. Instead of knocking on doors, the Internet has made it possible to research companies and work from living room couches around the world. The aforementioned study by the American Freelancer’s Union, confirms that 73% of freelancers find that technology has made it easier to find freelance work. Taking it one step further and using a specialized matching service for solutions that essentially help both consultants and clients, well that makes great sense.
The Matching Process
Success must depend much upon the success of the match between clients and consultants! “How do you make the matches,” I ask?
“It’s a special algorithm”, Toby explains. I look at him and ask: “like the dating sites?” We laugh. “Probably, just better” he responds. Now the special algorithm cannot be disclosed, but I listen with interest, as he explains how they choose their consultants based just as much on social skills as professional ones. “This is the key to making a good match”, says Toby. When I express concern that extroverts will do better than introverts in the selection process; especially in the interview situations, he assures me that they consider all factors and that for some jobs being an extrovert is not an advantage.