The Global Arbitrage of Online Work

Physical work, like plumbing, is the only type of work unlikely to go online, according to oDesk.

 

If you thought it has been tough to find good work over the last couple of years, just wait.

The old problem was a bad economy, the kind of thing that ends. Trends suggest that we’re heading for a global online arbitrage of opportunity, however, with good workers in bad places able to snatch business away from better-performing environments. If that happens in large numbers, the competition will get really fierce for everyone.

Recently two of the biggest online staffing companies, oDesk and Elance, have released surveys concerning the companies that hire workers over the Internet to do things like write software, and the mindset of online workers themselves.

Between them, oDesk and Elance claim to have more than four million coders, Web designers, marketing professionals and other workers. Some even spot porn on Facebook at a rate of four for a penny. In the second quarter of 2012, oDesk says, its contractors worked over 8.5 million hours, a 70 percent increase over a year earlier. The average freelancer at Elance, meantime, expects to make 43 percent more money in 2013, as more employers come online.

Taken together, the reports indicate a lot of growth ahead in the business, and a lot of talented people looking for work wherever they can find it. oDesk, which surveyed over 2,800 companies that used its service, found that 10 percent of these buyers were college students, and 58 percent described their companies as start-ups.

Not all those young companies will survive, but the habit of hiring online seems baked in; 64 percent of respondents said at least half of their work force would be online by 2015, and 94 percent predicted that in 10 years most businesses would consist of online temps and physical full-time workers.

The range of jobs done online is increasing, too. Workers on Elance said the highest-growing job categories in 2013 would be Web programming, making mobile applications, design, marketing and content writing. oDesk respondents were heavily in those categories too, but also saw employment in customer service, secretarial work and high-level technology development.

“As we move along, we see an increase in all the categories of work,” said Gary Swart, the chief executive of oDesk. “We now have lawyers, accountants, financial executives, even managers.” The only work unlikely to go online is immediate physical work, like plumbing, he said, adding, “but even a plumber needs an accountant.”

What he doesn’t need, apparently, is an accountant anywhere nearby. Some 30 percent of the United States citizens working on oDesk are working for overseas companies, Mr. Swart said. An even greater number of overseas people are probably working for Americans, too. In interviews, both companies say the continuing economic troubles in Europe are driving more people to online employment. oDesk has seen a 78 percent growth in hours billed by companies in Britain this year, even though it has never had much of a presence there.

The online work is already changing how some governments think about labor. Last May the government of Bangladesh decided to classify online work as export-related commercial income, free of taxes, instead of as a taxed offshore remittance.

The idea, Mr. Swart said, is to foster the growth of online workers. In other words, if you’re reading this from one of the better parts of the global economy, it’s a good time to think about how to be indispensable.

Another interesting wrinkle from the oDesk survey: Education alone probably won’t help you get hired. Only 6 percent of the survey respondents rated schooling as a “very important” reason to hire someone. It was the lowest-rated reason to hire someone. Work experience was first, followed by how other people rated the contractor, pay, portfolio of work, references, and scores on skills tests that oDesk offers online.

In the future, having a degree may be helpful, but having a reputation will be even better.