According to the gospel, free agency isn't just a business model; it's a workers-liberation movement, promising emancipation from the shackles of corporate America.
The Price of Freedom
In the much-romanticized free-agent nation, workers are liberated from routines, dress codes and office politics. As well as benefits, vacations and regular paychecks.
It's early winter. Cold. We've ordered in breaded-chicken sandwiches, Ari Horowitz and I, and are sitting in his cheerless office in Midtown Manhattan. "This whole concept of having to be in the office from 9 to 5, or whatever it is, that's gone, that's just not the world," muses Horowitz, founder of FreeAgent.com, a Web site for independent contractors, freelancers, part-timers and moonlighters. "There's no corporate loyalty or any of that stuff anymore."
Above Horowitz's desk is a badly framed reproduction of a Jackson Pollock. Near the door, tacked to the wall, is a blown-up cover of Snowboard Life magazine that Horowitz rescued from someone's trash. ("Learn to Snowboard the Easy Way!") Not that Horowitz, 31, has much time for snowboarding or art collecting. Himself, he's not a free agent. "I'm an entrepreneur, so I've got to come here every day. I can't disappear. I can't even take vacations. The free agent has a much better lifestyle. They're not necessarily going to make as much money as I might, but they can go snowboarding; they can decide when they want to work and when they don't want to work. It's an incredible lifestyle. I can't really think of a better way to spend your life."
Along with Horowitz, a small but vocal group of academics, evangelists and entrepreneurs are promoting this way of life: they're convinced we're on the cusp of a free-agent revolution. From their point of view, big centralized companies with thousands of permanent employees are relics. Back in the days of manual typewriters, before the electronic age, megacompanies made sense. How else could a team of engineers, designers and marketers work together? But in the digital age, the reasoning goes, megacorporations will be displaced by something called virtual corporations—teams of "free agents" who work together for the duration of a project, and no longer. Ari Horowitz compares the virtual corporation to a movie set: "In Hollywood, when you produce a movie, it's not about a corporation, it's about all these individuals who have complementary skill sets: they come together, they work on a team, they produce something and they disperse," he explains. "This is what I envision the future of work being."
According to the gospel, free agency isn't just a business model; it's a workers-liberation movement, promising emancipation from the shackles of corporate America. Perhaps you've heard this radio ad for FreeAgent.com, whose slogan is "For a Brave New Work Force": "If people often call you the hired gun, you just may be a free agent. If people call you 'that guy on 15 who's been here forever,' you are not a free agent. If you've ever sent an urgent e-mail pitching yourself for a primo project half a world away, you're a free agent. If you've ever sent an urgent e-mail asking, 'Who left the burrito in the office microwave?' you are not a free agent."
Fussing over burritos left in the microwave is hopelessly conventional. As are dental plans, expense accounts, life insurance, 401(k) plans and sick leave. Today's heroes take risks—they're entrepreneurs and I.P.O. millionaires, and if you haven't achieved that status, becoming a free agent may be the next best thing. The term free agent conjures the seven-figure salaries of professional ballplayers. It also hints at self-reliance: free agents, like mercenary soldiers, can join one army after another. They don't need the company, they claim; the company needs them. "Be your own boss!" exhorts an advertisement for Guru.com, another Web site for free agents. "Work where you want, when you want. No supervisors. No commuting hassles. Earn $$$ thousands. Freedom to balance your priorities and work in your pajamas."
The cult of the free agent took off in January 1998, when Fast Company, organ of new-age management, heralded on its cover, "Free Agent Nation." As if reporting the demise of corporate America (with its layoffs, office politics, demotions, harassment, hierarchies and general incompetence), the cover lines continued: "25 Million Americans Declare Independence. Are You Ready to Join Them?" It was the Boston Tea Party all over again.
The author of that story, Daniel Pink, a former speechwriter for Al Gore, has since become a one-man advocacy group for free agency, quoted as an authority in publications like Newsweek and The Wall Street Journal. A contributing editor at Fast Company, Pink is currently writing a book about free agents. He also operates a Web site called FreeAgentNation.com, and he gives (paid) speeches promoting free agency. In exchange for stock options, he serves on the advisory board of FreeAgent.com's parent company, Opus360, and writes an advice column for Guru.com. Pink claims he's enriching the lives of workers (many of whom do not have stock options). "I happen to think it's a human way to work, so I advocate it for people," he tells me.
Pink believes that something bigger and higher than technology is driving the free-agent revolution: a search for spirituality. "I thought this was an economic story," he says. "Then I realized it was much gooier than that. It's about emotions, feelings, lifestyle, family. . . . After I wrote the Fast Company article, my mailbox started flooding with letters from people saying, 'Oh, my God, this is me!' Work has become almost a secular religion; people are trying to self-actualize through work. But it's hard to find yourself in a cubicle. It's easier when you're on your own." In other words, earning $$$ thousands in your pajamas may well be the path to self-fulfillment.
Pink's greatest contribution to free agency involves statistics: when he wrote the Fast Company article, he counted 25 million free agents in America; now he says there are 33 million. Just how did Pink arrive at those huge numbers? He won't let on. "I'm pretty sure the government agencies don't know how to count this," he says confidently, explaining how his estimate is nearly three times larger than numbers compiled by the Bureau of Labor Statistics (which says there are 12 million nontraditional workers in America). "I have in my book a separate chapter on numbers," Pink continues. "But I'd like to hold off on giving out that information until the book comes out. It's very difficult," he admits, "to be definitive."
Definitive or not, by this time Pink's hopeful and opportunistic numbers have been repeated so often they've become a cliche; repeated in stock-offering prospectuses, publicity material and other channels of hype. "Between you and me," a founder of a temp agency said, "Dan had no clue. But his numbers became gospel and, hey, it worked. Now everyone bases the market on those numbers."
Promoting their business models with Pink's buoyant stats, dozens of companies targeting free agents have been popping up. Among them: icPlanet.com, Ants.com, IMCOR.com, eLance.com, MBAFreeAgents.com, iNiku.com and Aquent.com.
Like FreeAgent.com, these Web sites match employers with employees, listing short-term and part-time jobs and encouraging "free agents" to post resumes online. They also offer advice and give pep talks promoting free agency to those who cling to their 401(k)'s as if to life rafts. ("Sure working for yourself is scary," warns Aquent's Web site. "Life is an adventure and then you die. Live now!") MBAFreeAgents' focus is business-school graduates; Aquent's is technology; IMCOR's is "portable executives," including chief executive officers, chief financial officers and chief technology officers.
Other companies riding the free-agent wave include the Ebays of human capital: online talent auctions like Bid4Geeks.com and Talent Market, part of Monster.com, where free agents offer their services to the highest bidder. Recently, a freelance pastry chef in Astoria, Queens, with a talent for making croissants and brioches, put himself up for sale on Talent Market. (He had attracted no bidders when I last checked.) At Ants.com and icPlanet.com, free agents compete in a process known as a reverse auction, in which an employer offers a job and entertains bids. One posting at Ants.com, for example, urges multilingual free agents to bid on this job: translating a mammoth high-tech manual from French into Turkish and English. As of late February, 12 translators had placed bids ranging from $50,000 to $750,000.
Whether they specialize in technology or Turkish, dot-coms dedicated to free agents have yet to prove they can make money. According to documents filed with the Securities and Exchange Commission, FreeAgent.com, for example, lost $30 million last year on revenues of just $400,000. Access to the site's basic services is free to anyone who registers with FreeAgent.com; at last count (Feb. 9), roughly 64,000 people had done so.
But in order for FreeAgent.com to be profitable, it must get its registered users to upgrade to membership status, which costs $199 upfront, plus $119 to $274 a month (higher rates offer more benefits). Members—there were only 286 as of Feb. 9—get to buy group-rate insurance, join a retirement plan and have their paperwork looked after (invoices, bills, taxes and so on). Each member also receives between 250 and 500 stock options in FreeAgent.com's parent company, which is about to go public. In addition to fees from members, FreeAgent.com intends to charge companies for posting jobs. It also plans to sell banner ads and earn commissions on products sold through FreeAgent.com. An optimist, Horowitz anticipates that throngs of free agents, lured by "the perfect lifestyle," will eventually be drawn to his Web site.
For all the hype, there's nothing glamorous about most of the jobs posted on the free-agent Web sites. On FreeAgent.com, someone's looking for a bookkeeper to work 4 hours a week, there's a 15-hour-a-week job editing marketing material, an opening for a receptionist ("able to professionally answer 4+ incoming lines!") and so on through the range of skills.
I contacted a few dozen people whose resumes were posted on FreeAgent.com. Almost everyone admitted this much: if the right full-time, permanent job came along, they'd embrace it, eagerly. Last year Ralph Armenta lost his job as a managing director of a big hedge fund. When I spoke to him in January, he identified himself as "an involuntary free agent," working from his home in New Jersey on short-term assignments. "I'm 40 years old," he explained. "I have a couple of kids, age 6 and 2. I'd like stability. Maybe if I were 5 or 10 years younger and had less responsibility, I would take a run at it. But I want to be back in the work force." He doesn't want to earn $$$ thousands in his pajamas; like most people, he'd like a regular paycheck.
The profile that Paulette M. Glassman posted on FreeAgent.com highlights her 10 years of experience producing advertisements and films. But like Armenta, Glassman is not a free agent by choice. She is forced to make do with part-time work. "I keep hearing about how good the job situation is, but for me, for people who are grown women—I'd rather not give my age, but I'm not 21—it's been tough to find work. I'm struggling to stay solvent." Most of the responses Glassman gets to her posting on FreeAgent.com and other job-recruitment Web sites are unwelcome: offers from multilevel marketing outfits, many of which appear to be Ponzi schemes. Sometimes, when the phone does ring in her cramped studio apartment, it's a debt-collection agency calling.
More than 60 percent of free agents earn less than regular full-time workers in comparable jobs, according to a study by the Economic Policy Institute, a left-leaning Washington research group. They have no benefits, they don't get stock options or paid vacations, and free agents may not be protected by employment laws. "It's certainly true that there's a growth in the number of workers who are contract workers," remarks Stephen Barley, co-director of the Center for Work Technology and Organization at Stanford University. Barley spent two years studying free agents in Silicon Valley. (The results of that study will be published later this year.) "To call them free agents, however, is, well, interesting. The vast majority of them work through a staffing firm." Which is to say that the vast majority of them are temps. Outside Hollywood and Silicon Valley, the "virtual corporation" is virtually unknown.
For people whose skills are in high demand—Java programmers, corporate turnaround experts, Internet consultants—being a free agent may have the potential to be liberating. Last summer, Samantha Saturn (her real name) quit her job as director of marketing for CDNow, an online music store, in order to do her very own thing. She called her firm Saturn Network, whose promising slogan is "Expert Marketing Solutions for Digital Brands." So far, working out of a one-bedroom apartment in Greenwich Village, Saturn, 28, has had four short-term assignments. Her latest: a five-month marketing project for PlanetOut, a gay-and-lesbian Web site that's getting ready for an initial public offering.
Saturn sets her own hours. She telecommutes. She doesn't have to play office politics anymore. Sometime she works from Les Deux Gamins, an of-the-moment cafe right around the corner from her apartment. Installing herself at a corner table with her I.B.M. laptop, cell phone and a pot of coffee, as if Les Deux Gamins were her office, Saturn holds meetings, she brainstorms, she writes long memos. "It makes me feel like I'm in Paris," she says. Like Hemingway at Les Deux Magots.
But New York in the 2000's is a lot more expensive than Paris in the 1920's. Being a free agent is costly. There are bills to pay: office supplies, long-distance phone calls, Internet service, photocopying, FedEx deliveries, travel, business lunches, lawyers and accountants. There's health insurance and Social Security and Medicare taxes, which, at 15.3 percent of income, is double what old-fashioned permanent employees pay. To balance the burden, Saturn has been given a bit of equity from some of the dot-coms she has counseled. "I'm getting little pieces of a lot of companies at a very critical time," she explains sotto voce. "There's no way I could do this unless I were a venture capitalist."
About her past life as an ordinary full-time employee, she remembers that she "was a slave to my job, a total workaholic." Is she following the 12 steps? Not exactly. "Actually," she confesses, "I work more now."
Back in 1988, long before the term "free agent" signified the emancipated worker, Randy Nelson, now 50, made a business decision: never ever again would he be tied to one company. For eight years, Nelson had been a rising executive in the oil-and-gas division of CSX Railroad in Houston. When CSX decided to get out of oil and gas, Nelson was out of a job, just like that. "That was a wake-up call for me, a watershed event, an epiphany," he recalls. "I thought, I never again want my personal identity to be wrapped up in a corporation. From now on I want to think of my employer as a customer, a client, a revenue generator."
Now Nelson identifies himself as a free agent, a portable executive. His last project was overseeing the introduction of software at a chemicals firm in New Jersey. It lasted 18 months. "I'm an entrepreneur, a make-things-happen guy, a mover-shaker," he says excitedly, explaining why the free-agent life suits him to a T. "I'm not a nurturer; I'm not a long-term guy."
But as Nelson admits, there's a downside to being your own boss and doing your own thing. "It's a very hard, grueling lifestyle," he says. On his last project, he was away from home for a year and a half. "I only came home on alternate weekends. And you don't have control over the downtime between assignments. You may want two months off but get five, or want five months off an'd get only six weeks. You can't do it if you're not a self-driven person who's happy being lonely. You'll always be an outsider; you'll never be accepted as a full member of the team. You're kind of like the gunslinger who comes into town. People will say you're a coldblooded mercenary and look down on you for that."
The longer Nelson and I talked, the more his enthusiasm seemed to wane. "Sooner or later," he said, "I'm going to tire of this interim-executive thing."
Who has the most to gain from the free-agent revolution? Certainly those who advocate it. Ari Horowitz must surely be grateful that he is not a free agent but an Internet entrepreneur instead. He'll probably be worth about $35 million, on paper, when Opus360, FreeAgent.com's parent company, completes its coming initial public offering. As for Dan Pink, unofficial census taker of the free-agent nation, he'll soon be able to cash in his options in FreeAgent.com. And when his book is published early next year, he'll no doubt take his free-agent publicity machine on the road.
The other big winners are companies in the market for what economists call a flexible work force, which is to say, workers who can be hired and fired overnight, in the blink of an eye. Workers who answer 4-plus incoming lines and to whom you have no obligation whatsoever. Workers who are here today, gone tomorrow.
FreeAgent.com knows the score. Its Web site includes a page that encourages employers to hire its eager temps. "Top 10 Reasons Why Managers Love Free Agents" is how it begins. And then FreeAgent.com shows its hand:
10. They don't need pep talks.
9. They don't gripe about their salary.
8. They won't stab you in the back.
7. They tell you when your ideas [expletive].
6. When they're sick, they work from home.
5. They don't ask for health insurance, paid vacations, personal days...
4. ...401(k) plans, stock options, quarterly bonuses....
3. no performance reviews.
2. If they're stupid, lazy or incompetent, you can fire them pretty easily.
1. They do all the work, you take all the credit.