Extra Money: Get Full-Time Work As A Part-Timer

Free Agent Nation is an important book with an Amazon.com sales rank of 28,070. Daniel Pink, the author, is a contributing editor at Wired Magazine, where he has written about topics ranging from grassroots solar power to the rise of Wikipedia. A free agent himself, Daniel held his last real job in the White House, where he served from 1995 to 1997 as chief speechwriter to Vice President Al Gore. He's also worked as an aide to U.S. Secretary of Labor Robert B. Reich, an economic policy staffer in the U.S. Senate, a legal researcher in India, and a latrine builder in Botswana. He received a B.A., with honors in linguistics, from Northwestern University, where he was elected to Phi Beta Kappa, and has a J.D. from Yale Law School. He is happy to say he has never practiced law.
I’ve picked up several ideas for articles from Daniel Pink’s writings for Fast Company. He stays right on the cutting edge of new technology and new thinking and manages to portray these to the public well ahead of normal media. This book reinforces ideas I’ve had for a long time about getting out of the normal mindless workplace. One of the beginning ideas taught to me in my very first college management course was Abraham Mazlow’s Hierarchy of Needs. At the time, Mazlow took sort of a second place to the teachings of Frederick Taylor with his time and motion studies.
Many problems encountered by large corporations right this minute derive from inability to understand the change in worker attitudes away from "Taylor-ization" and toward tailorizing their workplace to the needs of the company, rather than the needs of workers. The U.S. economy has advanced in a monumental way from the conditions existing at the beginning of the Industrial Revolution when Taylor’s ideas prevailed. The basic economic needs at the bottom of Mazlow’s hierarchy have mostly been met giving workers the freedom to pursue fulfilling their individual dreams, Mazlow’s self-actualization. This article is about achieving your own self-actualization while, at the same time, filling your personal need for income in these catastrophic economic times.
Mr. Pink also dwells on the idea that everyone will never be able to be in their own business, a free agent in this book. But he also says even if free agency is not possible for all on a full time basis, every worker should try to have a part time free agency in order to accomplish the highest point on the Hierarchy of Needs for themselves. This article expands on this idea, as well. We will show how, in today’s job market, the opportunities for full time work with benefits are almost non-existent. The alternative to poverty may include some kind of free agent employment.
WHY ARE BUSINESSES NOT HIRING?
Businesses in the U.S., including the larger small businesses, are right now sitting on multi-trillions of dollars in stashed cash. So, why aren’t they hiring employees and expanding their manufacturing facilities? Part of the problem is that banks are not making loan funds available; why should they? They can get funds at zero percent interest and reinvest in 91-day Treasury Bills that yield .085 percent with almost no risk. This enables the banks to make a ton of money without risking anything. If they lend to businesses or anyone else there is a substantial risk of default. Knowing that banks are reluctant to lend money, all businesses are unwilling to expose all their own funds; so, they continue to sit on trillions of dollars.
Ask the CEO of any company, large or small, why they aren’t hiring or expanding their operations, aand all will tell you it’s the uncertainty of government actions they are facing. What are they talking about? First, there is an overwhelming volume of regulations coming out daily from the EPA, FDA, Agriculture Department, and every other governoment organization. There are so many rules and regulations already that no business can possibly know if they are in compliance or not. If they expand and start hiring, how many regulations will they violate? Nobody knows. So, they hire no one and do not expand operations.
That’s not the only problem facing the CEO. What about the uncertain tax future. The so-called Bush Tax Cuts are set to expire at the end of 2012 resulting in the largest tax increase ever seen in the U.S.. The unforeseen consequences are a major reason companies are sitting on all that cash. It’s a cushion for unexpected situations.
Another serious unknown facing CEOs is the cost of 2010 Affordable Care Act, the effect of which on businesses will not be known until 2013 and beyond.
Add to all this the struggling U.S. and global economies. In Europe you have the worst case economy of Greece, followed by Italy, Portugal, Spain, and who knows what other country will begin to fail. If any of these countries has an economy that totally fails, it will spill over into the U.S. because we are all linked as trading partners.
These are the major reasons U.S. companies are not hiring. The only actions that can change all these problems, except the last one involving the economy, is a change in U.S. government policies. No matter who wins the White House, it will still be years before an appreciable change in the hiring situation will become obvious.
WHAT HAPPENS IF I NEED A JOB?
Cost is the primary determinant of the success or failure of every business decision. Projects are assigned a budget and work is started with the hope and expectation of making a profit as a result. The budget has to be checked on a regular basis to be sure you are not exceeding the costs you originally assigned to the project. If you are coming close to going over budget, it is time to stop and see what might be done differently; if you have already gone over budget, you must completely stop and decide whether to rework the project, or cut your losses and completely abandon the project. This is what is going on now in all businesses because of the uncertain economic climate.
Imagine what it would be like to suddenly become totally blind and have to grope in the dark to find things you normally take for granted. This is exactly what business managers are going through today. They are groping in the dark because they don’t know what government regulations, taxes, and requirements will be enacted every day. They will not do any appreciable hiring or expansion until they can see the future once more.
How does this affect a person looking for a job? This Money Magazine article says applicants must forget about benefits–they won’t get any. Rather than hiring full time employees, companies are opting for free agents, freelancers, and independent contractors to do the required work. These people are on their own with respect to health care and other regulations that may apply to full time workers.
Employers are reluctant to wade through what they cannot see and make a substantial investment in full time employees with a benefit package. Why is this so expensive? Employees never see these figures, but a typical benefit selection bears a cost up to 28% over the basic wage payment. This means an employee hired at $40,000 actually will cost the employer $51,200, a large chunk of money: if you add taxes and a retirement contribution, this could rise to 35%, making the cost of a $40,000 new hire as much as $54,000. Wow!
New hiring is not likely to happen right now when business has to operate in the dark. The emphasis for employers right now is to contain costs; there is no room for new employees in this unknown climate. In fact, some small and large businesses are even reducing their work force as a cost control measure. Attrition will probably be the method most executives use to downsize; they will just not replace employees who quit. The idea is to add more work to some employees who have extra time. Redistribution of work can’t work but so long because the work load will outstrip available employees. In this situation, here come the free agents and contractors to do the work. No benefits required here.
This is an opportunity for home-based entrepreneurs with extra time available. Many home-based people are already engaged in freelancing or contract work. I work as a freelance writer and it is a very satisfactory way to earn a living. If you haven’t tried it, this is a good time to become involved.
MORE PROBLEMS FACING SMALL BUSINESS
Small and home-based businesses are often faced with a more immediate problem other than uncertainty. It is a lack of sources to cover cash flow shortages. Most businesses having seasonal ebbs and flows of money; it depends on how many sales they make. In normal economic times these companies get a short term bank loan to tide them over until cash begins to flow again; this option is not possible now with banks reluctant to lend to anyone. What else can they do keep their business going?
This report describes what some owners are doing. Many are turning to the 10,000 or so pawnshops around the country. There are several reasons for this:

• Different from banks, pawnshops are ready, willing, and able to lend.
  
  
• There is no credit check because the amount of the loan is based on the value of the object pawned.
  
  
• Cash is available immediately.
  
  
• Pawnshops do charge a high rate of interest, but the owner can retrieve his pawned object if he chooses to repay the loan plus interest.
  
  
• If the loan is not repaid, the object is sold by the pawnbroker. There is no effect whatsoever on your credit score or credit report. Nobody knows about the transaction but you and the pawnbroker.
  
  
• The entire pawn operation is quick, painless, and private.
  
  
• Pawning is much better than using a credit card–the credit card just puts you deeper in debt.

Although individuals pawn all sorts of things including guns, power, tools, electronics, and whatever else they may have, business owners must have more valuable items in order to meet payrolls and invoices that have become due. Because of the down economy, many dollars in credit card lines have been lost, as have home equity lines, the two sources most small companies have relied on in the past. Some business owners now bring in watches by Rolex, Cartier, and other designers that pawn for $5,000 to $10,000 each. They also pawn expensive diamond rings and engagement rings that pawn for thousands of dollars apiece.
The high price of gold is another reason owners are using pawn shops. You can pawn unused gold jewelry and other gold items for cash; if you don’t intend to pay off the loan, it will not cloud your credit. Many company owners prefer to pawn their gold rather than sell it. In spite of the high interest for pawning, most see it as better than selling gold and having to pay capital gains tax on the sale. In addition, when they are able, they can repay their loan and get back their gold.
DESPERATE TIMES REQUIRE DESPERATE ACTIONS
Those who work from home don’t have a problem of renting business space. However, many small businesses do require rental space for their companies. With the economy in the tank, owners look for any way they can to cut expenses; one way is to lower rental costs. Some small cities around the U.S. have developed contests to attract new business to their location by sponsoring contests. The winner generally gets a year of free rent, which could require moving your business. Before you decide to try for free rent you must be sure that, if you win, the location is right for your company and that you will be able to expand your operation from that location. Most contests require the winner to sign a three-year lease which kicks in after the first free year.
Here you can find a few of the places that offer contests for free rent. A lot of them are startups, but some are ongoing companies. The idea behind these contests is to fill vacant space in the specific location of the contest. Many of these contests have drawn other businesses in addition to the rental winners, which is a hoped for result.
MONEY IS NOT ALWAYS THE BEST SOLUTION
Congress set aside $30 billion for the Small Business Lending Fund passed as part of the Small Business Jobs Act last year. However, only a small portion has been allotted to eligible banks, and much of this is unused. Why? Unless they really need money right now for ongoing projects, the same uncertainty we’ve been discussing is keeping many small businesses from seeking bank loans. This is a continuation of the situation where companies that really need money can’t get it, while the others, who could use money, do not want to borrow in these uncertain times. For more about why this money is not doing what it was hoped it would do, see this article.
This is a good example of why all the so-called “stimulus” has not succeeded in restarting the economy. Throwing money everywhere without good economic policies to go with it will never work. If the government had removed the uncertainty about taxes, healthcare, and onerous regulations, all the thrown money probably would have had a positive effect on job creation and the economy
CONCLUSION
This discussion of why business is sitting on trillions of dollars instead of expanding operations and making new hires opens many opportunities for home-based and small entrepreneurs. A lot of home-based entrepreneurs are already into freelancing, contracting, and other free agent work. Most of these are always looking for new activities, so look around and go for those companies with possible positions you can fill.
The fact that some small companies are having to go to the pawn shop for money opens chances for negotiating free agent opportunities. Because home-based entrepreneurs work for themselves, they are in a position to negotiate a deal with business operators. For example, a home-based entrepreneur could offer to work through a period of poor cash flow in return for a higher payout in a few weeks. Be creative and you will be able to find many well-paying situations.