A Blog by Jonathan Low


Aug 9, 2013

Hiring IT Workers in the Open Talent Economy

We've got this all wrong. We should be talking about The Euphemism Economy: a right sizing, productivity enhancing, free agent nation. Because the economic powers that be keep coming up with mild, sensitive, non-threatening ways of convincing people that their best interests are served by further reductions in compensation, rights and benefits while their obligations and responsibilities increase.

The Open Talent economy is meant to convey notions redolent of opportunity: freedom of choice to set work, schedule, timetables and, of course, pay. The much harsher reality is that most of these arrangements are imposed, not sought out. The work is contingent on the employer's needs and wants, not the employee's. Much of the available talent pool is there because other employers made them so. They would not be if they had any choice in the matter or, mirabile dictu, a full time job.

And, as the except says below, why wouldn't businesses be increasingly comfortable using online sites to hire free lancers? They are less expensive to begin with, because they are more desperate for the work. The employer sets the terms of the contract, which can be terminated at will. The so-called lack of talent which is ostensibly driving them to this solution is similarly manufactured: the median income of IT workers is flat to slightly down in the midst of what has been, arguably, the greatest market for IT talent in history. In response, tech entrepreneurs and their more established brethren are pressing the US government to increase the number of visas available for tech workers from overseas so that demand does not drive already suppressed wages higher.

The accompanying illustration, from consulting firm that espouses the open talent concept to willing clients and then helps provide some of that needed workforce, uses open doors as a symbol of opportunity. But the symbolism also unwittingly conveys a more somber truth, that for many these arrangements offer an empty future. JL

Mohana Ravindranath reports in the Washington Post:

Businesses are growing increasingly comfortable using online sites to locate and hire freelance workers to supplement their tech teams
The phenomenon is part of what some are calling an “open talent economy” that relies on a variety of temporary, voluntary and salaried workers to get tasks done at a time when technology is shaking up many business models.
“There’s a very high demand and low supply of the talent that’s required within the workforce. They’ve been forced to look at other ways to meet that supply,” said Andrew Liakopoulos, a Deloitte Human Capital principal who co-authored a recent report on the trend.
Two Web sites allowing freelancers to both bid on tech work and complete the work online have experienced a marked boost in interest over the past year. A report from Mountain View, Calif.-based freelance staffing platform Elance — culling data from about 2.64 million freelancers on its site — showed businesses spent 335 percent more on network and security jobs on Elance this year than one year ago. Data from oDesk, a platform based in Redwood City, Calif. with 4 million freelancers, also shows significant growth in interest for various tech skills. Between June and July of this year, for instance, demand from employers for freelancers specializing in Mac OS app development grew 178 percent, and for video streaming by 110 percent.
This growth in demand for online freelancers could also be driven by a shortage of local tech talent, oDesk vice president of international and enterprise Matt Cooper said.
“As it pertains specifically to tech talent, everywhere you go all you hear is there’s more demand than supply. In some areas, it’s worse than others. If you’re a mobile developer in Detroit, the demand for mobile development is not as bad as it would be in the Bay Area. What online work does is smooth out those geographical imbalances,” he said.
CGo to your blog listost pressures can play a role in the use of freelancers, said Liakopoulos. But many younger tech workers also value the flexibility of freelance jobs. Since technology work is often project based, it’s easy for freelancers to bid on discrete projects, he said.
“They have the power of the Internet and social tools to go out and bid for work on their own.”
Liakopoulos said the trend means firms may want to start thinking about how to organize such workforces.
“What this is going to start causing is a lot of virtual work. If you hire freelance talent [they] can go through an entire project without being in the same room together. Creating this collaboration will be a challenge,” Liakopoulos said.
And freelancers may not immediately understand a firm’s culture or history, added Elaine Loo, a senior manager at Deloitte: “How are you able to shape the work so you don’t necessarily need that?”


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