7 Reasons America Is Fast Becoming a 1099 Nation

By Cubie King

job, jobs, career

Take heed dear reader. We are smack in the middle of a major sea change occurring in businesses across America; and its taking place right before our very eyes. Companies are forever changing the way they hire employees today, and I predict this is just the beginning of something that will explode in 2011 and beyond.

Gone forever are the days of the permanent employee (W-2's). Here to stay are the days of the new "contract worker," better known in the accounting world as 1099's. Companies are rapidly changing strategy when it comes to hiring employees. To understand this new phenomenon, you must view it from an employer perspective. When a company hires a person as a 1099 they don't have to pay:

1. Workers Comp. claims,

2. Into a retirement fund,

3. Vacation time,

4. Sick leave,

5. Health insurance or,

6. Payroll taxes;

7. Huge employee lawsuits, just to name a few.

The Problem

The American workforce is aging rapidly. By 2011 more than 40% of the current U.S. workforce will be over the age of 40. According to The Bureau of Labor Statistics (BLS), once the oldest baby boomers reach age 65 in 2011, the population will begin to age rapidly, and there will be a shortfall of over ten million skilled (or qualified) workers. The operative word is "qualified."

More Opportunities

As more companies go to the new 1099 format, they will look for the most qualified person to help move the project forward. Thus worker be become more like ball players who sign a contract for a specific period of time and when that contract is complete, they will move on to another.

It's not hard to imagine more companies going to the "1099- contract worker" format. Well, ready or not here they come. However, with great opposition come great opportunities. The war for find "qualified" workers is about to heat up big time, and for those employees who have sharpened and honed their skills; you will be in great demand.

Summary

The American workplace is in the mist a major sea change. No longer will workers be classified as permanent (W-2's), but more companies are quickly going to a 1099 (contract worker) format. This will allow companies to field the best and brightest talent, while at the same reduce obligations and liabilities.