Beyond Job Placement: The Self-Employment Boom

The traditional outcome in vocational rehabilitation is a job placement. But as a result of labor market changes, corporate restructuring, and an increase in technological advances, jobs do not look quite the same as they used to. Indeed, the very concept of employment in America is rapidly changing.

As a result of these changes, there is a need to examine traditional job placements within rehabilitation. Within this context, I asked Alan Forrester to assist in exploring an employment option of increasing interest--that of self-employment.

Alan Forrester is president of the Forrester Group, a consulting firm that specializes in multinational marketing and financial management. One of his companies was ranked by INC. magazine as the 42nd fastest growing privately held company in the U.S. He has assisted many individuals in starting and building their own business.

Driving Forces Within the Labor Market

Loss of Jobs

Nine million jobs have been lost in the Fortune 1,000 companies alone. In the summer of 1993, the Bureau of Labor Statistics noted that the ratio of terminated workers to temporarily laid off workers was 4:1, as compared to the 1982 ratio of 2:1.

A U.S. News and World Report cover story, "Where Did My Career Go?", noted that the current annual rate of job recovery is only 20% of the average rate of recovery in recessions since 1950. James Medoff, a Harvard economist, stated "Today, people who lose their jobs are history." Eighty-five percent of those who lost white collar jobs will never get them back--an all time high for any recession.

This permanent job loss is the result of a restructuring of work in America. Two leading causes of this trend are technology and the use of temporary workers.

Role of Technology

More and more corporations are re-engineering their operations and eliminating jobs through the use of technology. For example, Mazda modified its accounts payable system to the point that the company could accomplish with five employees what Ford was using 400 employees to accomplish. In turn, Ford's full scale job re-engineering reduced its account payable staff by 75%. According to the Wall Street Journal, job re-engineering throughout Americas private sector could eliminate 25 million jobs.

The increased emphasis on technology is quickly making nontechnology based jobs obsolete. Peter Drucker estimated that new workers, who handle data instead of things, "already number at least one third and more likely two thirds of all employees." This increase in technology and information-based jobs is reducing the need for people to work at corporate offices. Recent estimates indicate there are at least 6.5 million workers telecommuting part-time. An additional 8.5 million work at home after hours.

The Temporary Work Force

What are all the people doing as a result of the de-jobbing of America? A large number of them are entering the temporary work force. Lance Morrow wrote a 1993 article for Time called "The Tempting of America." In the article, he indicated that America has entered the age of the contingent or temporary worker. He also said that the workers of the future will have to continually sell their skills and invent new relationships with their employers. The number of temporary workers has increased almost 60% since 1980.

This shift is evidenced in the largest corporations in America. Manpower, a temporary employment agency, has 560,000 employees and is the largest U.S. employer. In comparison, GM and IBM employ 365,000 and 330,000, respectively.

The Resulting Need for Financial and Job Security

William Bridges, author of Job Shift stated "All jobs in today's economy are temporary. The job as a social artifact is on the wane...Work arrangements that are taking its place...are themselves temporary in the sense that they are created to meet productivity needs in an immediate but changing situation." An increasing number of corporations are designing their work environment to be project focused rather than job focused. When the project ends, the job ends.

So what must a person do in today's environment to achieve any level of security? We can no longer depend on corporate America to provide it. The concept of job security has changed. Financial security is something individuals must now build for themselves.

The "good" job, which was once the definition of responsibility and security, is now very risky business. Conversely, freelance activity, once risky, is now in tune with the future and is becoming the employment choice of many people.

The Self-Employment Boom

One option for individuals in our de-jobbed environment is the self-employment arena and the home-based business. LINK Resources annual Work at Home survey reports that the current self-employment rate is 13%, which is double that of 1977. There are 11.8 million part-time home-based self-employed people, and 12.1 million full-time. The Work at Home Sourcebook states that there are 40 million Americans who currently work at home, including 16 million home-based corporate workers. This represents a growth rate of 20% per year. Some government studies have indicated that as much as 75% of the work done in this country could eventually be home-based. Donald Hicks, a political economist at the University of Texas, conducted a study of employment in Dallas and found that 61% of jobs were created by new businesses and 25% by expanding small businesses. Many of these new businesses and expanding small businesses were started by a self-employed person.

There are hundreds of companies willing to purchase products and services from home-based businesses in the following fields:

Arts
Crafts
Computer based work
Office support
Industrial work
Sales

In addition to the above, there are hundreds of home business opportunities in the following areas:

Automotive services
Business services
Computer-related services
Residential and commercial cleaning and maintenance
Personal services
Photographic services
Publishing
Real estate and financial services
Travel services

Implications for Vocational Rehabilitation

Are our current education and training systems mirroring the nations self-employment boom? Or, are we preparing workers for the old corporate model? As we experience these changes in the labor market, what can be done to assist vocational rehabilitation consumers in realizing self-employment related outcomes?

Self-employment as a rehabilitation outcome is not a new concept. But an understandable skepticism toward the approach may exist, given the challenges faced by those rehabilitation organizations that have embraced the concept in the past. Previous approaches have been perceived as costly, have focused on small business opportunities as opposed to home-based self-employment, and have yielded only minimal successful outcomes for persons with disabilities. Nevertheless, new and different opportunities have emerged in the labor market. Perhaps it is time to reexamine the concept and rethink traditional approaches.

A Systems View

So where does an organization begin? The first step is to systematically build the capacity to provide self-employment and home-based business outcomes. Capacity building begins with an evaluation of the organizations current policies and processes, in order to determine the system-wide changes necessary to support the initiative. There are a number of determinations to be made at the organizational level, prior to taking action. Here are a few examples:

Is self-employment defined and measured as a quality rehabilitation outcome within the existing system? Does current policy support practice? What policy development may be necessary?

What are the costs associated with providing self-employment outcomes versus traditional job placement? What resource planning is necessary? What community and interagency relationships need to be established to support your efforts?

In what ways do current service delivery practices support or limit the pursuit of self-employment outcomes? What are effective approaches for assessing skills and interests related to self-employment? For matching individuals interests to existing opportunities? What counseling and training approaches need to be developed?

What are the self-employment opportunities at the local level? What are the local labor and laws? (For example, the Fair Labor Standards Act prohibits home workers from making women's apparel. In Chicago, it is illegal to use electrical equipment in a home occupation. This means no calculators, no typewriters, and no computers).

It is clear that building the capacity to provide self-employment outcomes, as with any new initiative, requires considerable up-front analysis and planning. Organizations cannot afford to introduce any new paradigm into an existing system without first assessing the system-wide changes necessary to support the new concept. But can you afford to not continually assess processes and practices to respond to what is taking place in the larger environment?

Today's job market is vastly different from ten years ago. Corporate America can no longer be relied upon to provide secure jobs to individuals entering or returning to the work force. To increase the effectiveness of vocational rehabilitation services, perhaps it is time to expand opportunities for consumers to explore self-employment. This option could serve as a path to independence for a number of persons with disabilities within vocational rehabilitation. Will your organization be the one to initiate the approach?

The opinions expressed in this document are those of the authors and do not necessarily represent the policy of the Department of Education, and you should not assume endorsement by the Federal government.

Questions? Would you like to receive periodic updates about our research and training activities? Do you have comments or suggestions about this site? E-mail your requests, comments and suggestions to Diana Spas or call 888-268-2743 and ask for the Information Coordinator.


	Self-Employment in Vocational Rehabilitation: Building on Lessons from Rural America Beyond Job Placement: The Self-Employment Boom by Allan Forrester, The Forrester Group, Introduction by Deon Locklin, Georgia State University, Atlanta, Georgia. Reprinted with permission from the Journal of Rehabilitation Administration, Vol.19 (2), 147-150.
The traditional outcome in vocational rehabilitation is a job placement. But as a result of labor market changes, corporate restructuring, and an increase in technological advances, jobs do not look quite the same as they used to. Indeed, the very concept of employment in America is rapidly changing. As a result of these changes, there is a need to examine traditional job placements within rehabilitation. Within this context, I asked Alan Forrester to assist in exploring an employment option of increasing interest--that of self-employment. Alan Forrester is president of the Forrester Group, a consulting firm that specializes in multinational marketing and financial management. One of his companies was ranked by INC. magazine as the 42nd fastest growing privately held company in the U.S. He has assisted many individuals in starting and building their own business. Driving Forces Within the Labor Market Loss of Jobs Nine million jobs have been lost in the Fortune 1,000 companies alone. In the summer of 1993, the Bureau of Labor Statistics noted that the ratio of terminated workers to temporarily laid off workers was 4:1, as compared to the 1982 ratio of 2:1. A U.S. News and World Report cover story, "Where Did My Career Go?", noted that the current annual rate of job recovery is only 20% of the average rate of recovery in recessions since 1950. James Medoff, a Harvard economist, stated "Today, people who lose their jobs are history." Eighty-five percent of those who lost white collar jobs will never get them back--an all time high for any recession. This permanent job loss is the result of a restructuring of work in America. Two leading causes of this trend are technology and the use of temporary workers. Role of Technology More and more corporations are re-engineering their operations and eliminating jobs through the use of technology. For example, Mazda modified its accounts payable system to the point that the company could accomplish with five employees what Ford was using 400 employees to accomplish. In turn, Ford's full scale job re-engineering reduced its account payable staff by 75%. According to the Wall Street Journal, job re-engineering throughout Americas private sector could eliminate 25 million jobs. The increased emphasis on technology is quickly making nontechnology based jobs obsolete. Peter Drucker estimated that new workers, who handle data instead of things, "already number at least one third and more likely two thirds of all employees." This increase in technology and information-based jobs is reducing the need for people to work at corporate offices. Recent estimates indicate there are at least 6.5 million workers telecommuting part-time. An additional 8.5 million work at home after hours. The Temporary Work Force What are all the people doing as a result of the de-jobbing of America? A large number of them are entering the temporary work force. Lance Morrow wrote a 1993 article for Time called "The Tempting of America." In the article, he indicated that America has entered the age of the contingent or temporary worker. He also said that the workers of the future will have to continually sell their skills and invent new relationships with their employers. The number of temporary workers has increased almost 60% since 1980. This shift is evidenced in the largest corporations in America. Manpower, a temporary employment agency, has 560,000 employees and is the largest U.S. employer. In comparison, GM and IBM employ 365,000 and 330,000, respectively. The Resulting Need for Financial and Job Security William Bridges, author of Job Shift stated "All jobs in today's economy are temporary. The job as a social artifact is on the wane...Work arrangements that are taking its place...are themselves temporary in the sense that they are created to meet productivity needs in an immediate but changing situation." An increasing number of corporations are designing their work environment to be project focused rather than job focused. When the project ends, the job ends. So what must a person do in today's environment to achieve any level of security? We can no longer depend on corporate America to provide it. The concept of job security has changed. Financial security is something individuals must now build for themselves. The "good" job, which was once the definition of responsibility and security, is now very risky business. Conversely, freelance activity, once risky, is now in tune with the future and is becoming the employment choice of many people. The Self-Employment Boom One option for individuals in our de-jobbed environment is the self-employment arena and the home-based business. LINK Resources annual Work at Home survey reports that the current self-employment rate is 13%, which is double that of 1977. There are 11.8 million part-time home-based self-employed people, and 12.1 million full-time. The Work at Home Sourcebook states that there are 40 million Americans who currently work at home, including 16 million home-based corporate workers. This represents a growth rate of 20% per year. Some government studies have indicated that as much as 75% of the work done in this country could eventually be home-based. Donald Hicks, a political economist at the University of Texas, conducted a study of employment in Dallas and found that 61% of jobs were created by new businesses and 25% by expanding small businesses. Many of these new businesses and expanding small businesses were started by a self-employed person. There are hundreds of companies willing to purchase products and services from home-based businesses in the following fields: Arts Crafts Computer based work Office support Industrial work Sales In addition to the above, there are hundreds of home business opportunities in the following areas: Automotive services Business services Computer-related services Residential and commercial cleaning and maintenance Personal services Photographic services Publishing Real estate and financial services Travel services Implications for Vocational Rehabilitation Are our current education and training systems mirroring the nations self-employment boom? Or, are we preparing workers for the old corporate model? As we experience these changes in the labor market, what can be done to assist vocational rehabilitation consumers in realizing self-employment related outcomes? Self-employment as a rehabilitation outcome is not a new concept. But an understandable skepticism toward the approach may exist, given the challenges faced by those rehabilitation organizations that have embraced the concept in the past. Previous approaches have been perceived as costly, have focused on small business opportunities as opposed to home-based self-employment, and have yielded only minimal successful outcomes for persons with disabilities. Nevertheless, new and different opportunities have emerged in the labor market. Perhaps it is time to reexamine the concept and rethink traditional approaches. A Systems View So where does an organization begin? The first step is to systematically build the capacity to provide self-employment and home-based business outcomes. Capacity building begins with an evaluation of the organizations current policies and processes, in order to determine the system-wide changes necessary to support the initiative. There are a number of determinations to be made at the organizational level, prior to taking action. Here are a few examples: Is self-employment defined and measured as a quality rehabilitation outcome within the existing system? Does current policy support practice? What policy development may be necessary? What are the costs associated with providing self-employment outcomes versus traditional job placement? What resource planning is necessary? What community and interagency relationships need to be established to support your efforts? In what ways do current service delivery practices support or limit the pursuit of self-employment outcomes? What are effective approaches for assessing skills and interests related to self-employment? For matching individuals interests to existing opportunities? What counseling and training approaches need to be developed? What are the self-employment opportunities at the local level? What are the local labor and laws? (For example, the Fair Labor Standards Act prohibits home workers from making women's apparel. In Chicago, it is illegal to use electrical equipment in a home occupation. This means no calculators, no typewriters, and no computers). It is clear that building the capacity to provide self-employment outcomes, as with any new initiative, requires considerable up-front analysis and planning. Organizations cannot afford to introduce any new paradigm into an existing system without first assessing the system-wide changes necessary to support the new concept. But can you afford to not continually assess processes and practices to respond to what is taking place in the larger environment? Today's job market is vastly different from ten years ago. Corporate America can no longer be relied upon to provide secure jobs to individuals entering or returning to the work force. To increase the effectiveness of vocational rehabilitation services, perhaps it is time to expand opportunities for consumers to explore self-employment. This option could serve as a path to independence for a number of persons with disabilities within vocational rehabilitation. Will your organization be the one to initiate the approach? The opinions expressed in this document are those of the authors and do not necessarily represent the policy of the Department of Education, and you should not assume endorsement by the Federal government. Questions? Would you like to receive periodic updates about our research and training activities? Do you have comments or suggestions about this site? E-mail your requests, comments and suggestions to Diana Spas or call 888-268-2743 and ask for the Information Coordinator.

Self-Employment in Vocational Rehabilitation: Building on Lessons from Rural America