It may not be a good time to be an employee, but surprisingly it’s a great time to be self-employed or an independent consultant.
At least, that’s what Gallup found in a recent study on Americans and their overall happiness.
The upshot of the Gallup Healthways Well Being study was that American adults are generally more happy, except when it comes to work environment. In the work sector, employees are just generally feeling grim, a reason for the steep decline.
Self-employed or independent workers are a bright spot in the otherwise grim workplace result. I’m not at all surprised by their high happiness level, because I’ve been running a business that serves the independent consulting market for more than 25 years, and I see this happiness effect firsthand.
Independent consultants have control over their income and life. They can add skills in response to market demands, adjust fees up or down, scale work to fit their life and income goals and are not reliant on the economies of a single employer for survival. Being in control is a recipe for happiness.
Retired Lieutenant General Jan Huly is among those who score high on the happiness scale. Huly became an independent consultant after a 37-year career in the Marine Corps. “I wasn’t sure what I wanted to do post-retirement, but I knew I wanted to enjoy myself, have more freedom, and yet still make a positive contribution with my skills,” he says. Huly has found “unsurpassed freedom” in his post-retirement career and is part of a growing population of retirees who leave the traditional workforce and begin a second lifestyle career where they control when, where and how they work. As independent consultants, these new retirees can even combine work and travel, taking assignments in other cities or countries.
As it turns out, independent consulting is not only good for morale, but it also fits perfectly in the shifting landscape of the new world of work. More and more, professionals are moving into second-stage careers in order to manage their lives, or better balance priorities, or due to the deterioration of the safety net that once existed between employers and workers. Today’s companies often cannot afford the healthcare and welfare costs of traditional employment. Employees are instead absorbing higher costs for insurance premiums and co-pays, and there is nearly a complete elimination of defined benefit plans. The changes have made traditional employment less attractive to the modern professional, opening the door to independent consulting as an alternative career path.
Shaugn Davenport is one of those people who reinvented his career and used independent consulting as a bridge between two career directions — but needed help managing the inherent challenges of becoming self-employed. Davenport, a CIO, lost his job after his corporate employer struggled financially and lost the safety net of health insurance. The interruption of income would be hard on anyone but Davenport also had a child with a disability and health insurance was critical. Unhappy as a CIO, he used this opportunity to re-orient his career path. He leveraged his skills to become an independent consultant and found a partner to help set up the right infrastructure, managing the business and benefits side of the time he spent as an independent consultant. When the time was right, he returned to a traditional role but remains an advocate for the independent lifestyle and its many benefits.
Davenport, Huly and many others found happiness in independent consulting — but this career path is not without risks and challenges. Consultants must deal with the lack of benefits, finding work, billing and invoicing, taxes, compliance and all of the other back-office issues that come with running a business. It’s also often hard to become a vendor for a large enterprise, because they impose strict compliance rules on direct independent engagements. Consultants and companies are at risk if systems are not set up correctly and each could face audits, penalties and a loss of work.
My advice is simple. Even the fiercest independent doesn’t usually benefit from going it alone. Partnership and the use of smart tools and resources are the way to stay happily self-employed. Without an infrastructure for managing the risks and administrative details of business, consultants can become full time business managers instead of focusing on their core expertise. The best way to avoid the distraction of business management is to outsource your administration and infrastructure. Sure, you could do it yourself and spend countless lost billable hours on the Internet finding solutions to manage the administrative, HR, legal and financial end of your business – or you can seek out solutions that easily handle all these processes for you. When your primary product is your knowledge, every minute you spend doing something else is a lost opportunity.
If you’re like Shaugn Davenport and looking for a solution for mid career change, or like General Huly, and want that perfect second phase career, be smart about the ways to work best as an independent, and all the happiness and satisfaction of being in control of your own destiny awaits you.
— source: Gene Zaino is the President of MBO Partners