Instead of courting large companies like Amazon, cities should court freelancers

At the beginning of last year, more than 200 cities competed to host Amazon’s second headquarters. Alongside tax incentives and business-friendly government, they were answering questions like how they would...

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June 12, 2019
New York

Now, It’s crystal clear (pun intended) that Amazon HQ2 will change Crystal City, Arlington in Virginia - the city that was eventually selected from a list of 20 finalists - forever. But when it comes to the future of work and cities as a whole, I can’t help but think that—rather than bending over backwards to court enormous companies like Amazon—it would be worth attracting another type of worker that will be just as important in the future.

More than one in three Americans has done some sort of freelancing,and the frequency of this work is likely to continue. Not every city can be the home of an Amazon. But with some thought, any of them could focus on building the best city in the world for independent workers.

Why attract freelancers

The reason that the Amazons of this world are so popular with cities is that they promise to bring a lot of jobs wherever they decide to build their new headquarters. Amazon, for instance, employs 566,000 people worldwide, including full-time and part-time workers, and HQ2 is expected to add about 50,000 to that figure.

But jobs are no longer the only way that people find work. According to the freelance marketplace Upwork, there are now 57 million US freelancers, representing 35% of the entire workforce (47% among millennials). This category, according to Upwork’s analysis, is growing three times faster than the rest of the workforce and will represent a majority of the entire workforce in less than a decade.

Freelance, independent, and self-employed workers are found in every sector and income quintile, come from every demographic, and cite a range of motivations. So it’s easy to balk when a one-size-fits-all strategy isn’t readily apparent. But focusing on freelancers also has a big advantage for cities that goes beyond employing the people who live there.

Independent workers don’t only exist locally; they’re also a key part of global talent mobility. It’s not only your freelance photographer neighbor who is part of the freelance workforce; it’s also the engineer, marketing maven or C-suite executive who has opted for a change of place, wants to see the world, or simply wants better work-life balance. For cities, catering to freelancers could be a strategy for not only harnessing the talent that’s already there, but also becoming a place where workers everywhere want to move.

Building a freelancer HQ

Workforce development drives economic development. And given that most workers will be independent, every city should be planning its freelancers strategy from the ground-up.

A visionary mayor and her team can—and should—get started on this strategy today. Here are some starting points:

  • From stigma to significant: In many places, saying you’re self-employed is perceived as a saying you’re unemployed. This mindset is stuck in 20th century models. Make it clear—with both words and actions—that independents, freelancers, remote and flexible workers, and the self-employed are valued as much as any other type of workplace arrangement. New York City’s newFreelance Isn’t Free Act is a nod in this direction.
  • Support for startups, not sand in their wheels: Make it easy for independent workers to establish and grow their livelihoods. San Francisco provides a freelancer ‘starter kit’ for workers tapping into the on-demand economy. Estonia offers e-Residency, which enables both individuals and enterprises to conduct business seamlessly and affordably, from anywhere in the world.
  • Connectivity far beyond wifi: In today’s digital economy, easy, reliable, high-speed internet access is table stakes. Sustained economic development requires integrated investment and connections. Provide free around-the-clock wifi. Take idle city-owned spaces and convert them to collaborative workspaces. Support networks and associations that facilitate independent worker connections ( Upwork, Meetup, Intuit, and Freelancers Union all do this in different ways). Prototype a 21st century worker guild.
  • From work to life: 70% of independent workers opt in to their working arrangements. Among the most common reasons for this are increased flexibility, freedom, and purpose in one’s work. In other words, independent workers value lifestyle. They’re ready to work hard, but resist work dominating their life. For cities, this insight is easy: be an awesome place to live. Celebrate parks, artists and neighborhood street fairs as much as skyscraper ribbon-cuttings. Actually, even more.
  • The quadrillion-dollar elephant in the room: A future of independent workers tests almost every aspect of 20th century labor policy, which assumes traditional employment (both as reality and as desired goal). Today, we are in the early stages of rethinking our social safety nets, a process that may take decades to sort out—unless social crises hit first. Cities must prototype and prioritize initiatives that serve the needs of independent workers, particularly around insurance, healthcare, mobility, disability, tax, financial and retirement planning.
  • Don’t wait: The independent worker train has left the station and continues to gain momentum at a quick clip. By the time many policy makers (and certainly the federal government) have woken up, it will be too late. Nevertheless, there is a lot that cities can learn, pilot and invest in without full-blown reform. For example, worker classification lawsuits are unlikely to cease anytime soon. Don’t get bogged down waiting for courts to decide: not only will you lose precious time, but because litigation will be determined on a case-by-case basis, any result will also have limited scope. Whether we call a worker an employee or independent contractor, or a new, in-between category ultimately comes about, the issue of shredding social safety nets doesn’t go away. Instead of fretting over judges’ slow pace, invest in piloting new forms of portable benefits, and use that as a pillar of your re-election campaign.

The future of work and cities go hand-in-hand. Those cities that embrace, encourage and celebrate independent workers will be at the vanguard of change and victorious in the war for talent—a feat that no Amazon could top.

An earlier version of this piece was published prior to Amazon's HQ2 decisions on Quartz.

April Rinne
April Rinne
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June 12, 2019
New York