Independent work: choice, necessity, and the gig economy


Individuals need to manage their own work lives more actively than in the past



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Individuals need to manage their own work lives more actively than in the past
Independent work may allow individuals to escape the constraints of the corporate world, 
but it places a new set of demands on them. Each independent worker is essentially a 
self-contained small business—and running that business may demand new skills that are 
not in their natural wheelhouse. The challenge of constantly landing new business requires 
marketing savvy, for instance. It is also important for independent workers to consider 
diversifying their income streams so they are not totally reliant on one client who can cut 
them loose at any time. It takes administrative skill and foresight to prepare for peaks and 
valleys in earnings, to perform all tax and legal compliance, and to manage accounting. 
Independent earners also have to take an aggressive approach toward saving for retirement 
107
 
Digital finance for all
, McKinsey Global Institute, September 2016.
108
  Susan Lund, James Manyika, and Sree Ramaswamy, “Preparing for a new era of work,” 
McKinsey Quarterly

November 2012.
109
  See Aaron De Smet, Susan Lund, and William Schaninger, “Organizing for the future,” 
McKinsey Quarterly

January 2016, and 
A labor market that works: Connecting talent with opportunity in the digital age
, McKinsey 
Global Institute, June 2015.


97
McKinsey Global Institute
Independent work: Choice, necessity, and the gig economy
on their own if they hope to supplement social security plans, and they must act as their own 
investment managers. 
It is increasingly important for all workers—whether independent or traditional—to map out 
their own career trajectories, looking for their own new opportunities and taking charge of 
developing their own skills along the way.
110
 Those who are independent will need to be even 
more proactive in gaining the new skills, experiences, and credentials that will serve them 
along the way. 
***
There has been a great deal of commentary about whether the shift to more independent 
work is an empowering development or whether it puts more workers in precarious 
circumstances. But the issue is not black and white; the independent workforce comprises 
people in a range of circumstances. As policy makers consider how to address their needs, 
the central question might be how to improve the economic prospects of the reluctant and 
the financially strapped segments, turning them into true free agents. Enabling people to 
work in the style they prefer, with more control over their own professional destiny and work-
life balance, has the potential to make millions of workers happier and more empowered. 
If this shift is carefully monitored and managed, it could unlock real benefits for workers, 
companies, and broader economies.
110
  See Reid Hoffman and Ben Casnocha, 
The start-up of you: Adapt to the future, invest in yourself, and 
transform your career
, Crown Business, 2013.


98
McKinsey Global Institute
 
© fotostorm/Getty Images


This appendix provides additional detail on the methodologies and data sources employed 
in the report. Specifically, it includes the following topics:
1. 
Definition of independent work and related terminology
2. 
Data sources for sizing the independent workforce 
3. 
MGI survey methodology
4. 
Labor market characteristics of the six survey countries
5. 
Estimating growth potential of the independent workforce based on aspirations stated in 
survey responses
6. 
Methodology for occupational analysis
7. 
Methodology for analyzing the conversion of unpaid household work to paid work

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