New forms of self- employment in Russia: Remote work patterns and E-markets This study was carried out within “The National Research University Higher School of Economics’ Academic Fund Program in , research grant No XIII April international Academic Conference on Economic and Social Development (April 5, 2012)

2 Self-Employment in the New Economy Service sector Knowledge-intensive and Creative industries Remote work or Telework (using ICT) Global E-markets

3 E-lance economy “The fundamental unit of such an economy is not the corporation but the individual. Tasks aren’t assigned and controlled through a stable chain of management but rather are carried out autonomously by independent contractors. These electronically connected freelancers – e-lancers – join together into fluid and temporary networks to produce and sell goods and services. When the job is done – after a day, a month, a year – the network dissolves, and its members become independent agents again, circulating through the economy, seeking the next assignment”. Thomas W. Malone and Robert J. Laubacher The Dawn of the E-Lance Economy (1998)

4 Online Marketplaces for Freelancers Name Year of foundation Working language Registered users Freelancer.com2004Eng.3,000,000 oDesk.com2003Eng.2,000,000 Elance.com1999Eng.1,300,000 Guru.com2000Eng.1,000,000 Free-lance.ru2005Rus.1,000,000 vWorker.com2001Eng.500,000

5 New phenomenon for Russia Self-employment in the USSR was illegal Information and Communication Technology (ICT) lag

6 Self-employment in Russia TypeRussiaEU Own account workers (without employees) All self-employed (including employers and contributing family workers) Source: ILO

7 Online Marketplaces for Freelancers NameRussiaUKUSA Internet penetration rate (% of population) 43 %84 %78 % Use the Internet for their work (% of the labor force) 23 %77 %62 % Source: FOM, RLMS-HSE, E-skills.com, Pew Research Center

8 Free-lance.Ru: Registered Users Growth Amount of users (in thousands)

9 Data Overview 1. Second Russian Freelance Survey (2011, March), N = 10,943 Future freelancers (2,925) Active freelancers (7,179) (from Russia – 4,474) Former freelancers (839) 2. Russian Longitudinal Monitoring Survey – HSE (2010, Oct), N = 21,343 Russian working population (10,145) 47.5% of general population Russian employees using the Internet for their work (2,017) 9.5% of general population 19.9% of Russian working population

10 Questionnaire: about 50 questions Demographic and professional profile Work values and motivation Employment strategies Relationships with clients Satisfaction Income and well-being Self-management Work-life balance

Gender %

Age % Mean: years old

Education %

Employment Status GENUINE FREELANCERS (29%) Employees (43%) Students (13%) House- wives (6%) Entre- preneurs (8%)

Skills of Freelancers %

16 Work Values % Which aspects do you personally think are important in a job?

17 Working Hours Mean: hours

18 Earnings (average monthly post-tax personal income in USD) Mean: 1, USD

19 Satisfaction All things considered, how satisfied are you with your life as a whole nowadays?

20 Conclusion: Electronic Freelancers in Russia Young individuals with a higher enterprising spirit and human capital, offering creative and knowledge-intensive services. Work longer hours than regular employees and often operate under pressure, but have a higher income, enjoy autonomy at work and are satisfied with their lives. “New middle class” and the vanguard of the workforce in terms of the nature of work, ICT-competence and motivation. Play an important role in the development of the Internet, e-business, and innovative entrepreneurship. But still very narrow and highly specific category of the workforce.

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