Do you make most of your income through short-term jobs, contract work, and freelance assignments? If so, you’re going to love Diane Mulcahy.

Before she wrote her first book, Diane taught a class called The Gig Economy at Babson College, named by Forbes as one of the “top 10 most innovative business school classes in the country.”

Listen in to Professor Diane Mulcahy to learn:

  • How to prepare for the future of work, where the gig economy rules
  • What it means to take responsibility for your own career to live the life you want
  • Why those with a side hustle are set to rule the new work order

What’s your back story?

It started when I read an article that used the term The Gig Economy, which was the first time that I had seen that term before. I swear to God I got goosebumps when I saw it, and I had a moment of epiphany where I felt like, “Oh my God! That is it. That is the thing that I have been thinking about for the past several years.”

I had always been trying to figure out how can I work differently. I don’t want to be a full-time employee. I don’t want to have just one job. I like to be able to do a variety of different things. I like to be able to take time off. I’m an avid traveler, and I had taken chunks of time off to go backpacking and things like that. I wanted to be able to incorporate that into my adult life.

So when I read this article and I saw this term, I immediately created a syllabus. I was doing a little bit of pro bono work at Babson College at the time and despite not having any previous teaching experience, I got the syllabus approved as an experimental course.

The funny part of this story is that when the department posted the course as part of the next semester’s listings, hardly anybody signed up. You have to have a minimum enrollment for experimental courses, and it didn’t make the cut, so the course was cancelled. But I tried again the next semester and got the enrollment that I needed.

That was five years ago. I’ve been teaching it to groups of MBA students since then, and a lot of the content in my book was informed by my experience teaching The Gig Economy to my students.

Why did you feel it was so important to teach The Gig Economy to others?

If we look around us, and especially if we’ve been in the corporate world and have worked full-time jobs over the course of our careers, we see a lot of people who are not happy in the work that they do, in the jobs that they have, in the type of life that they’re leading.

I live in a major city, I don’t have a long commute. I do work that I think is interesting, but I know a lot of people who aren’t in that situation and I was very dogged by the idea that there had to be another way for people to work that was more interesting, that was more exciting, and that made people more interested in the work that they did. Work that would give people more flexibility.

Do you see the gig economy as an integral part of the way people will work in the future?

First, I would say I don’t think the traditional job world is for everybody. But I suppose you could equally say that the gig economy is not for everybody.

What I would also say is that the traditional job world and the gig economy are increasingly colliding. What we are seeing in the traditional job world is a shortening of the median tenure in any one job.

What that means is that you’re always looking for your next gig, even when you land a new job, you’re already thinking about what’s the next opportunity.

How do I position myself?

How do I think about marketing myself?

How do I sell myself and create a brand?

How do I make myself attractive for my next employment situation?

Similarly, in the gig economy, you’re always looking to land your next client, project, or gig. The difference is only that of frequency. In the traditional job world, you’re doing it maybe every couple of years. In the Gig world, you’re doing it maybe every couple of months or maybe every couple of weeks if you’re just getting started. I think that they’re going to converge.

What traits does someone need to thrive in the gig economy?

Again, I like to draw the analogy with the traditional job-based economy. You have people who are doing really well and you have people who are struggling, who are scrambling for pay.

These people also exist in the gig economy, and I think it’s the same type of person that struggles in both environments. They are relatively unskilled and they may not be as educated.

The people who are doing well in both the traditional job economy and the gig economy are the people who are well-educated, who have skills that are in demand, who have experience that employers are seeking, or that have particular expertise that the market is interested in. It’s the same in both economies.

What’s the #1 takeaway from The Gig Economy?

First of all, when I talk about the gig economy, I’m talking about anybody who’s not a full-time employee in a full-time job. If you’re a consultant, or you’re a contractor, or a freelancer, or a part-time person, or an on-demand worker, you’re working the gig economy.

In terms of one major idea, the biggest takeaway for somebody who is thinking about entering the gig economy is to understand that you need to change the way you think about work and approach work to succeed in the gig economy.

For a lot of people, there’s this default path of going to college, maybe going to graduate school, graduating and then getting a job, a house, and living the normal sort of traditional American dream.

In the gig economy, there’s so much more uncertainty that you really need to examine what it is that you want out of your life on a deeper level. There is no longer an option to get a job and settle into a steady paycheck and put yourself on automatic pilot. It just doesn’t work that way anymore. The economy is too dynamic.

What surprised me most during my five years of teaching The Gig Economy and in the process of writing my book is how many people are buying and living a life that they don’t actually want because they’ve defaulted into this kind of standard path.

What you should be asking yourself is, what does success look like for you? What is it that you want to accomplish? What are the values that you want to be reflected in the life that you live both professionally and personally?

I really feel strongly that that’s where you have to start if you want to succeed in today’s economy.

What aspect of The Gig Economy resonates most with your students?

The exercise that generates the most passion is absolutely the time-off exercise.

“I have my students imagine that they have one year of time and one year of tuition equivalent in terms of cash. Then I ask them, ‘what would you do if you had those two resources at your disposal?'”

I like this exercise because it gets their minds freed from the constraints of time and money which limits so many of us. It’s a very powerful exercise because one: it unleashes the imagination, and two: once you write down your answer, you cannot un-write it and you cannot un-know it. After that, dreams begin to take route.

In fact, I had one student that was so moved by the whole course, and the time-off exercise in particular, that he lived it.

I got an email from him about two months ago.

He used the principles in the course to start an Airbnb business. He negotiated with landlords, got their approval to make several apartments Airbnb rentals, then he hired somebody to help him manage it.

Shortly after graduation, he left the country to go traveling. In his email he stated. “I am so excited to be pursuing this dream that I’ve always had to travel but never thought that I could accomplish. I’m loving my life. It’s amazing, and I don’t know when I’m coming back.”

That story really exemplifies how sitting down and really reflecting on just a few key questions can really clarify what it is that you want out of life.

What are some personal finance strategies that people working in the gig economy need to know about?

The most important piece of personal finance advice is similar to the one piece of life advice that I give in the book. Which is to clearly understand what the life that you want to buy is, because every lifestyle, no matter what it is, costs money.

We have to live somewhere, we have to do things outside of work for our entertainment, we have to support our families. It’s really important to be very clear on what it is that is important for you to buy, because otherwise what happens is you end up buying a lot of things that don’t really matter to you and yet you end up having to generate revenue in order to cover all those expenses.

If instead of having a mortgage, you’re open to a different living situation that includes renting, or being more nomadic, you’re reducing your need to borrow money. If you’re willing to live in a city and access your transportation using Lyft or Zipcar, or your local bicycle share, or public transit, you’re reducing your need to purchase a car. All of these things reduce your need to take on an enormous amount of debt.

Do you have any suggestions for improving the isolating nature of remote gigs?

I work in the gig economy and I don’t feel isolated at all. I think for most people who are working independently, they are working with others. They have clients. They’re working on projects. There’s a fair amount of networking involved in succeeding in the gig economy.

But for somebody who’s feeling isolated, I think one thing to do is to look at the kind of work that you’re doing and see if there’s a way to do work more project-based work that puts you in a position as part of the team, or to see if there’s a way to do work that is more locally based in which you can go on-site to the client and feel more a part of the team.

I also think that coworking spaces are incredible resources. There’s been some recent work that’s looked at workers who use coworking spaces and what they found is that those workers are actually happier than both people who work in an office and people who work from home.

The reason is that they get all the autonomy and flexibility of somebody who works from home, but they’re also in an environment of structure and one that is inherently social, with independent workers coming together to work from a common space.

So, coworking spaces offer a real viable and very cost-effective alternative for people who feel isolated.

It’s also important to live in a more urban environment if you’re going to be a remote worker.

I live in the middle of a city, so it’s very easy for me to go to events during the day to go to Chamber of Commerce breakfast, to serve on a board, and go to meetings during my lunch hour.

It’s easy for me to meet up with friends, former colleagues, business colleagues that might be coming through the city. It makes it so much easier to meet people in-person, to grab lunch, to grab coffee.

I think it’s much more difficult if you live away from that. If you’re in a suburb, in a neighborhood, nobody is home during the day. You have to get in your car and drive to go somewhere. It feels isolating. It’s time-consuming and not as casual to meet up with people.

Think about your living situation, is there a way to make that denser?

What does the future of the gig economy look like?

There are a couple of drivers of the gig economy.

One is that the job creation rate is at historic lows. Companies aren’t creating jobs at the same rate they used to, and they’re also figuring out that they don’t have to create jobs. They can actually take what used to be a job and disaggregate it into a series of tasks and projects.

The example I like to use is there aren’t very many reporters anymore, but there is a lot of freelance writing work. We’re seeing a movement from jobs to gig-based work.

The other thing driving the gig economy is companies. For many companies, the full-time employee really has become the worker of last resort because they’re expensive, they’re inflexible, it’s difficult to respond to their business needs and bring in the expertise they need at any given time.

Finally, people like the gig economy. Of all the surveys that have been done asking independent workers, “Would you work this way? Would you continue to work this way? Do you plan to continue to work this way? Do you plan to continue to go back to full-time work?”

Over 70% say they are choosing to work this way and they want to continue to choose to work in the gig economy. That’s a really powerful statement that people are finding this an attractive alternative.

The other interesting thing which I think gets no press at all is that many contractors in the gig economy are highly paid and their growth rate is increasing the fastest. What you’re seeing is highly paid professionals that have options are the ones choosing to work this way, because they have a choice.

If Diane Mulcahy was going to write a follow-up book to The Gig Economy, what would she write?

One of my real interests in the gig economy is the policy aspect of it. I’m a policy wonk. I have a Master’s in Public Policy and, against the advice of several people who read my manuscript, I squeezed in a chapter at the end on some of the policy issues that are important to think about as we move to this new way of working.

Things like the issue of employee classification, the structure of our labor market, and where we break jobs into contractors vs. employees are going to be interesting conversations we’re going to have to have in the near future. The topics of benefits and issues around portability and universality are also important, as is retirement and how we think about a safety net.

These are all interesting but fairly complex topics.

Do you have any parting advice for aspiring authors?

I heard a great saying which goes like this, “I hate to write. I love to have written,” and I think that’s so true.

Writing is never easy. It’s hard.

You wrestle to get concepts on paper. You fight with the words and the sentences and the paragraphs and the structure. It’s tedious and lonely. I think the only reason to write is if you have something that you really want to say. That’s the only thing that ever worked for me.

This book has been my life for several years and there was such a feeling of relief to have written it. But in the end, it was something that came from within and it was something that I felt needed to say.