How the Modern Workforce Is Changing the Social Contract

The social contract between employers and employees has gone through many changes over time. Traditionally, employees have relied on their employers for job security, stable career progression, and benefits in exchange for loyalty to that company. But many of these perks of traditional employment have changed over the past few years resulting in an erosion of the mutual loyalty between organizations and their employees.

Our 2024 State of Independence in America report reflects these changes—72.7 million people report working independently and 42% of traditional jobholders say they might change jobs this year, with 16% saying they plan to go independent over the next 2-3 years. Here’s a closer look.

A Social Contract Shift

The traditional model of working at one company for your entire career in exchange for benefits and a reliable retirement plan is increasingly a vision of the past. Traditional employees feel uncertain about their job security and many benefits such as retirement, health plans, and pensions have been cut back or eliminated. Workers are no longer feeling loyal to their employers and are often swayed by a promise of better benefits or pay even if the change means a lateral career move.

About one-third of traditional job holders report feeling worried about losing their jobs and about two-thirds say that having multiple sources of income is important. This concern is starkly reflected among side giggers, 40% of whom say they are worried about losing their primary job. About one-quarter of side giggers say that their side gig will provide them with a backup plan in case they do lose their primary job.

Sadly, only 63% of traditional jobholders believe their employer is committed to retaining talent. This erosion of trust and respect between employers and employees has made job switching commonplace. While some workers have responded to these changes by job hopping every few years, others have made the choice to shift to independent work.

More people than ever before are working independently, which has resulted in a growing network of support and infrastructure for independents. Sixty-five percent of full-time independent workers say they feel more secure working independently and 54% say they do not plan on going back to a traditional job.

Prioritizing Flexibility and Value-Driven Work

The modern worker is looking for a career that is both flexible and aligns with their personal values. Less than half of traditional job holders report that their job fits with who they are as an individual, whereas most independent workers believe that work should align with their values and self-perceptions. Working independently gives people the ability to start businesses based on personal interests, choose the clients they work with, and dedicate time to projects that interest them.

More than 60% of independents say continued personal growth is their top driver of working independently. Independents value helping others, spending time with family, and ensuring their life has purpose. Having control over their hours, where they work, and when they work offers a huge amount of flexibility in comparison to a traditional job. The vast majority of independents—85%—say they are happier working on their own, 79% say that working on their own is better for their health, and 65% say that they feel more secure working independently.

For enterprises, the independent workforce is an incredibly valuable pool of talent. Independent contractors are incredibly knowledgeable in their fields of expertise with many coming from competitive areas such as IT, marketing, biotechnology, or pharmaceuticals. Hiring on a project basis gives companies staffing flexibility, allowing them to increase or decrease their workforce based on goals or growth. A blended workforce can also give companies the ability to get to market faster, better manage turnover, and have lower human capital costs.

As more companies realize these advantages and engage independent talent to create blended workforces, we will see the social contract evolve to one that supports worker priorities and gives enterprises the power to be agile and competitive.

To learn more about the independent workforce, check out our latest research study: The Independent by Choice Movement: Authentic and Intentional.