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Robert Trigaux

2010 job outlook: More self employment, weaker bonds between employer, employee

11

January

ErikVonkADFrazierBOTHUSACherieDiez St. Petersburg job market watcher BOTH USA, which started up last year as an innovative back-office provider of services to the self-employed, has come up with some interesting job market predictions for 2010. (Photo of Erik Vonk, right, and A.D. Frazier, the two top executives of BOTH USA. Photo by Cherie Diez of St. Petersburg Times.)

Founder and CEO Erik Vonk of BOTH, which stands for "Back Of The House," expects a likely surge in self-employment, which his firm sees as a positive trend for BOTH and the country. "Flexible work arrangements reduce friction in the employment market and improve instances of a match in the supply and demand for skills," Vonk states.

Here's a condensed version of the 2010 predictions:

* Recessions produce sustained increases in self-employment and flexible work arrangements. In 2010 this increase could be proportionally greater than after previous recessions because a significant portion of the record number of unemployed will likely find their way back into the workforce as self-employed. (That makes sense since companies are scared to hire back quickly in such iffy times.)

* Full-time job creation will be slow to rebound. Over-supply will continue to define most segments of the employment market. Companies will remain cautious and tap "on demand" (temp or project workers) work arrangements as a part of flexible cost strategies. (Tampa Bay, for example, already sees a strong bounce in temp work. The question is when and if it translates later to full time hiring.)

* Wages will be flat thanks to too many people looking for work and government intervention in executive pay scales. (No kidding. Few people finding a new job after unemployment are earning what they received before.)

Job mobility will "structurally" increase, geographically and functionally. Why? Increases in job specialization, flexible work arrangements, self-employment and a decrease in employer/employee loyalty. (The only sticking point here is that people will not be mobile if they can't sell their homes. And households with dual incomes will find it a tougher decision to move if the second breadwinner is doing okay right where he/she is.)

* "Job security" will continue to decline while "income security" will continue to rise. Skilled individuals feel more secure about their ability to exchange their competencies for income "independently" outside of a conventional employment framework. (Translation? Sharp people with good skills may prosper on their own. My question is: What about competent people who are not good at selling themselves in the open market? How will they do outside traditional full-time work?)

* Companies will focus on people with specific skills rather than the “generalist” and middle management roles as businesses seek to grow leaner with more flexible cost structures. (No argument on this point.)

* Ballooning government payrolls mean an increase in civil servants as a percentage off the total workforce. (Personally, I'd rather this trend were going in the opposite direction.)

* Demand for health and retirement benefits will favor individually underwritten plans as complex and unclear healthcare reform spurs uncertainty among employers about future obligations. Increases in the number of self-employed will stimulate this demand. (Translation? Companies will offer increasingly mediocre and uncompetitive benefits packages, hoping eventually that their workers will find substitute coverage in the open market. That's probably a ways off, but it's coming.)

-- Robert Trigaux, Times Business Columnist

[Last modified: Tuesday, June 1, 2010 12:27pm]

    

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