Outsourcing

Is independent consulting on the rise?


Do you remember when "consulting" was a synonym for "unemployed"? People used to fill in holes in their resume time-lines with "consulting," and hope that the interviewer didn't ask about their clients during that period.

It think that's changed -- that consulting as an occupation has gained some genuine respect, and that more people in technical fields are opting for self-employment. I decided to do a little research to verify that last perception, but I Googled and Googled till my Googler was sore and couldn't find any statistics on longitudinal trends in self-employment in our industry. I did find a very interesting article on general trends in self-employment -- but even though table 7 attempts to break out the current numbers by industry and occupation, it doesn't get as specific as "computer-related," "IT," "technology" or the like. Besides, the data only goes up to 2003. I'd like to see more recent data, specific to IT, to confirm my suspicions.

Am I right? Do you see more of your colleagues calling themselves independent consultants these days? Or are they moving back into salaried positions?

Certainly, working for an employer has its benefits, not the least of which are the, well, benefits. But it's not like back in the days when you used to get fully paid health insurance for you and your family. And job security isn't as, um, secure as it used to be, either. When you're independent, even though a client can drop you with minimal notice and no severance package, at least you have the option of maintaining more than one engagement to cushion your fall.

This article in the December 2006 Monthly Labor Review puts forth an interesting theory: that self-employment increases during economic down-turns, because of the constriction of available opportunities for wage-earning employment. If my perception is correct that self-employment in the tech sector is growing, could this be (part of) the reason? Personally, I don't think so. At least, there seem to be plenty of job openings available -- most of my clients are actively looking for good people to hire. I think it has more to do with a desire for self-determination. That's certainly been my motivation to stay self-employed for the last 16 years. How about you?

About

Chip Camden has been programming since 1978, and he's still not done. An independent consultant since 1991, Chip specializes in software development tools, languages, and migration to new technology. Besides writing for TechRepublic's IT Consultant b...

20 comments
THEINDEPENDENT
THEINDEPENDENT

All independent consultants,startups, subject matter experts join for free... www.independent-consultant.com

THEINDEPENDENT
THEINDEPENDENT

All independent consultants,startups, subject matter experts join for free... www.independent-consultant.com

dutch
dutch

In 2000, I was forced to become a consultant due to the dot come that I was working at closing. I worked as a consultant for 4 years. Currently, I am working for someone else. I miss the freedom of not having to answer for every second of my day to someone else. I am very seriously considering going back to consulting.

amirzaians
amirzaians

I dont see it as rising, however the market is demanding more and more of true and highly skilled real technicians versus "Geeks On Call" or whomever they may. That is why i started to provide a better service for the consumer and business. www.realcomputersolutions.com Its just what the public wants

thargrav
thargrav

I've been an independent consultant for 6.5 years, longer than anyone I know. I believe that most professionals still become independent consultant to bridge jobs. Some are successful and some are not. Most who try either fail or are hired by a customer. It's not been a "bed of roses" for me. I have had some lean times, but overall it's worth it. I have also had several clients not understand my long term plans try to hire me. I develop custom database solutions for small businesses. My tools are SQL Server, Access and Visual Studio. Tom thargrav@hiwaay.net

Greeboid
Greeboid

I hope not. I'm about to go into business as an independant consultant! I would like to think that the competition was not too... numerous and well... competitive!

rhafner
rhafner

For me, the benefit of being an independent consultant lies in both freedom and money. What I do is something most small businesses couldn't afford full time, so by having a few dozen regular clients I'm able to make more money for less hours than a normal 9 to 5. The time I save I invest back into myself, previously by taking classes and studying various fields, but currently working on my own startup. The other benefit of being a consultant is that I don't become overly specialized- doing the same set of jobs over the course of years tends to focus a person on that job. This isn't a bad thing as experts are always needed, but as a consultant I'm not just a "server admin", "web developer", or whatever task I'm doing. I also manage my own finances, marketing, and other business related jobs and this gives me the insight that most employees don't have and allows me to present solutions that take the business into account.

proactivity
proactivity

I think that the internet is providing a greater ease in self-employment through bidding environments such as elance or guru.com. In addition to this there is increased support available http://www.computerconsultingkit.net is an example of this. I was up late a few weeks ago and watched a program that seemed to confirm your idea concerning the desire for self determination especially among the younger.

Sterling chip Camden
Sterling chip Camden

In this article, I'm almost guilty of conflating "consultant" and "independent contractor" again. I am aware that some people who call themselves "consultants" are employed by a consulting firm. I'm focusing here on the independents, though.

crisnupra
crisnupra

Being independent is great. You work in different environments each time and learn a lot of each work. Im not surprised to know that being a consultant is nowadays "in voga", cause it pays also nice and we have some flexible schedule in the week.

roygrubb
roygrubb

I've been an independent consultant since 1981 and can't imagine doing anything else. Most of the time I work from home, but I travel the world sometimes when an international client requires it, but never for more than a week if I can help it. Working in many companies and many teams keeps you fresh, challenged and interested. Although I was a practicing independent consultant before the Internet became readily accessible, on-line communication has made many projects possible that would have been very hard. In some jobs, I have been able to act as co-ordinator for a world-wide team, using the Internet. I think it's key not to regard the move to independent consulting as a bridging job. You need to project the aura of an established professional who's there to stay the course. I did assignments around Asia for one client, a US insurance company, for more than six years and was once handed off from one branch manager to his successor with "The thing about Roy is he's always there". All it meant was that I would always be available, not having moved on to another job. If you're starting as an independent consultant, it's worth realizing that this is perceived as a value proposition by many clients. (I'm not that smart - it took me several years for it to sink in.) Roy

Sterling chip Camden
Sterling chip Camden

I don't think that we're talking zero-sum game here. More people may be becoming independent, but that doesn't necessarily reduce the market for independents. I think it's more of a general shift in how business is done. Companies will always need good people, whether they're employees or contracted consultants.

Sterling chip Camden
Sterling chip Camden

That's a good point. As an independent, you're forced to be aware of business considerations for yourself, so they're also more obvious when you look at your customer's needs. And you do get a broader range of work experience -- but it's also good to have a specialty, no?

Sterling chip Camden
Sterling chip Camden

... also provides greater opportunity for serving more clients in distant locations. None of my active clients are in my local area, but my commute is about 100 feet.

BobR
BobR

I agree with the theory that ?self-employment increases during economic down-turns, because of the constriction of available opportunities for wage-earning employment?. In my observation, most independents do take a salaried position when they have the opportunity. If there are more independents right now here in northeast Ohio, it is because we are still dealing with a somewhat depressed economy. Most people do not seem to think the benefits of being independent outweigh the disadvantages. I do, but seem to be in the minority. I became an independent consultant when I was laid off in the year 2000. Most of my clients do try to hire me, but I plan on remaining independent the rest of my life if at all possible. I had been employed by a consulting firm and found out the hard way that the ?security? benefit of being an employee does not exist. Many people would pale at the thought of paying $1400/month for health insurance out of their pocket, but to me it is just a number in the formula in determining how much I need to charge per hour. The big thing for me is, I feel like I have control of my life! As an independent, as long as I get the job done, am onsite when needed, etc, nobody cares what time I start, what time I leave, how many hours a week I work, or how many vacation days I take. Scheduling my life around HR policy (8 hour days, 40 hour weeks, certain number of vacation days per year, etc) to me would be a choker-chain!

Sterling chip Camden
Sterling chip Camden

... as an independent, that's amazing! I thought I was an old hand at 16 years. Obviously, you've been able to keep on producing great value for your customers. Congratulations!

Tig2
Tig2

Back in the dark ages of IT, EVERYONE was a generalist- by necessity. You might be better at one thing or another but you generally did it all because IT was hardly considered a profession. Back in the day, it wasn't unusual to find myself the Network Admin, Hardware Specialist, Macro Writer, Script Writer, and occaisional Programmer. Oh, and Project Manager. I agree- being the best at one thing can be very lucrative. But having generalist knowledge in a specialist space can be good too. I am really good with Infrastructure. But being able to have a meaningful discussion with the Development Team and the Architects means that I don't make stupid hardware purchases.

Sterling chip Camden
Sterling chip Camden

Live free or die, says I. But $1400 a month for health insurance??? I'm paying $376/mo for the whole family with Lifewise. Not sure if that's available in Ohio, but you might want to check.

Sterling chip Camden
Sterling chip Camden

You're right about that, TiggerTwo. We used to write all our own utilities, even our text editors. I wasn't quite back in the days when they had to write all their own compilers, but I did write a couple of them for languages of my own invention.

BobR
BobR

We are a family of 6 with multiple preexisting conditions. One of the shots my son gets costs over $2000/month before insurance and would not be covered by most insurances. Not essential to live, but it dramatically improves his quality of life. We also reject some insurance plans that do not include the health care providers that are important to us. One more big reason to stay independent: I have control of my insurance plans. As an employee, I would be forced to go to the health care provider of someone else?s choosing, probably chosen on a lowest-cost basis. As we both agree ? options, and the freedom to choose, are what it?s all about.

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