Graduating MBAs and The Gig Economy
“Freelancing in America: 2017,” a recent study commissioned by Upwork and the Freelancers Union, estimates that about 57.3 million American workers, or 36 percent of the U.S. workforce, are freelancing. The study, considered the most comprehensive measure of the nation’s independent workforce, also notes that freelancers contribute about $1.4 trillion to the economy every year.
The steep rise in freelance work over the past decade has become known as the gig economy.
About 63 percent of freelancers report that they prefer working gigs rather than a full-time job. One of their primary reasons is the ability to maintain a diverse portfolio of work rather than being tied down to a single employer.
Students pursuing an online MBA degree will face with a choice after graduation: direct their career toward a steady, salaried middle-management position at one company, or use their accumulated skills and training to consult with multiple companies on a contract basis.
Contract Management Consultants: Gigs For MBAs
The gig economy, according to WhatIs.com, is “an environment in which temporary positions are common and organizations contract with independent workers for short-term engagements.” Other terms, such as “contingent worker,” denote essentially the same thing – a skilled worker who works temporary forms of employment.
“More than half the gig economy’s jobs come from four main industries: healthcare, education, construction, and professional and business services,” according to economists Lawrence F. Katz and Alan B. Krueger’s study on gig economies in the Business News Daily article, “The Growth Of The Gig Economy: A Look At American Freelancers.”
The industries Katz and Krueger examined use temporary, contract-based workers and freelancers, including management consultants. While most companies have a need for full-time MBAs, outside consultants with specialized expertise in specific types of management are often brought in to handle unusual circumstances such as expansions or other projects that fall outside of a company’s typical order of business.
“Management consultants are experts who are trained to solve complex problems, devise invaluable strategies, and improve the financial and operational health of their clients’ organization,” according to “What Does A Management Consultant Do?” on HumanResourcesMBA.net. “Most companies hire management consultants for their industry insight, problem-solving abilities, and logical objectivity. Management consultants apply research, analyze internal data, interview people, and prepare and present reports.”
Why Should MBAs Pursue Management Consulting As A Career?
The most common reasons why some choose freelancing or consulting rather than steady 9-to-5 careers include flexibility of hours, a desire for work-life balance, greater respect, better pay, and the ability to be one’s own boss.
Babson College lecturer Diane Mulcahy, in her Harvard Business Review article, “Why I Tell My MBA Students To Stop Looking For A Job And Join The Gig Economy,” notes three reasons why MBA grads should take their degrees into consulting work:
- Full-time jobs are disappearing. In the 20th century, new full-time jobs were created at an average rate of 2 to 3 percent per year. At the dawn of the 21st century, that rate began to drop. In 2015 (beginning after the 2008 economic downturn), that rate has remained below 1 percent. Startup companies are declining in number and fewer new jobs are being created in the process.
- Many companies have begun to avoid full-time employees in favor of contracting temporary workers. Contract consultants are now hired to come in and put together a strong business model so the company can move forward with as few full-time employees as possible. The impetus is financial: maintaining a full-time workforce is considerably more expensive than bringing in contract workers.
- The job security that used to be synonymous with full-time employment, complete with coveted wages and generous benefits, has all but disappeared. Almost 70 percent of Americans report that they do not feel engaged at their jobs, while independent workers are completely satisfied with their chosen careers. The autonomy of the gig economy results in nearly 70 percent of freelancers and consultants declaring that they have no intention to returning to full-time employment.
Another driving force behind the rise of the independent worker is technology itself. New platforms, new programming languages, new Internet of Things (IoT) devices, and new operating practices are constantly being adopted into the world of business. As a result, companies are finding that hiring for gig positions is faster and more efficient than maintaining full-time spots that may be made moot by new technologies in the near future. The practice lets businesses bring new talent on board and offload unneeded skills without much hassle.
“An increase in the number of in-house professionals with fragmented skill-sets as a result of technological change will increase pressure on companies to tap into highly specialized talent that has to choose to operate in the independent consulting marketplace instead of traditional firms,” consultant Gregg Fisher says in Lydia Dishman’s article, “How The Gig Economy Will Change In 2017,” on FastCompany.com.
Over the past few decades, the internet has changed the way companies and workers view the nature of work, As a result, more people are accepting the challenge of stepping away from the 9-to-5 office model to pursue careers as self-employed professionals.
Ohio University’s Master Of Business Administration Degree
Nationally recognized by US News & World Report as a “Best Online MBA” program, Ohio University’s online MBA degree program can position graduates to succeed in the traditional workforce or the gig economy. The program includes concentrations in finance, healthcare, executive management, and business analytics.
To learn more, visit Ohio University’s MBA Program page.