Land of the Free

Read the Web Exclusive: Free Agent Nation (Still) Wants You!

There are the laws of economics. There are the laws of physics. And there are the laws of Free Agent Nation.

Ignore these laws, and you're in trouble. Misunderstand them, or misapply them, and you could end up in a world of hurt. But figure them out -- especially the ones that matter, and why -- and you can navigate the suddenly stormy seas of 2001.

Begin with the laws of economics. Contrary to what some people seemed to believe in headier times, those laws never were suspended. You still have to understand supply and demand, profit and loss, and the art of value creation. That much seems clear.

But when it comes to the laws of physics, business leaders have fallen under the spell of the wrong law: Newton's third, which holds that for every action, there's an equal and opposite reaction.

How else to explain a consensus that has lurched from hyped-up overpromise to self-flagellating overreaction in two short years?

1999: Twentysomething Internet entrepreneurs are paradigm-shifting geniuses!
2001: Twentysomething Internet entrepreneurs are pathetic chumps who have to move back in with their parents!
1999: Jeff Bezos is Time magazine's Person of the Year!
2001: Jeff Bezos is the Idiot of the Young Century!
1999: Everyone is going to be a gazillionaire!
2001: Everyone is going to be laid off!

We've swung from euphoria to hopelessness faster than a bipolar personality aboard a roller coaster. Some of the new despair, of course, is understandable. Things have changed. The days of money for nothing and clicks for free are over.

But in embracing Newton's third law, we've ignored Newton's first law: A body in motion stays in motion unless acted upon by an outside force. That's the law that governs these jittery days -- and that's the law that forward-looking business leaders ought to heed. Three years ago, I wrote a report in Fast Company on a state (and a state of mind) called Free Agent Nation. Over the past two years, for a book I've just finished writing, I've traveled the country and spoken with hundreds of people who are on work's new frontier. I've come away convinced that in these challenging economic times, the bodies in motion are bright, talented, technologically savvy free agents -- and that for them, there is no equal and opposite reaction. They are staying in motion. They are not returning to the life of The Organization Man. They are not renouncing their citizenship in Free Agent Nation.

The new economy has always been about the capacity of one smart, passionate person -- an inspired innovator, a dynamic leader, a wild-eyed entrepreneur -- to do extraordinary things. Nothing has repealed this central principle. No outside force has thrown it off its course. Indeed, now that Net companies have gone bankrupt, day traders have gone broke, and IPOs have gone bust, we can see through the wreckage something that we previously had overlooked: Free agency is the real new economy.

Get beyond the manic-depressive business psychology of the moment and just look at the facts. You'll see the future unfolding.

Fact: With roughly 16 million soloists, 3 million temps, and 13 million micropreneurs, Free Agent Nation is larger than the entire public sector. Free agents outnumber all of the people who work for federal, state, county, and local governments -- even when you include police officers and teachers.

Fact: According to the Census Bureau's latest figures, 70% of businesses in the United States have no paid employees.

Fact: In California, only one out of three workers has a traditional job -- the leave-your-home-in-the-morning-to-work-for-someone-else employment arrangement that is the basis of this country's labor laws, its health-insurance and pension systems, and its many public policies. According to the University of California at San Francisco, two out of three Californians don't have a traditional job. Hmmm. I wonder: Has California ever been on the edge of any trend in the United States?

Millions of people are alive and well and living in Free Agent Nation. Some have leaped there because of bad bosses, dysfunctional workplaces, or the false promise of Internet riches. Others have been pushed -- by mergers, downsizings, and a fresh wave of layoffs. It doesn't matter. What counts, for most companies, most bosses, and most workers, is that free agency has changed the game. What counts are the seven new laws of Free Agent Nation.

And if you want to compete on the new frontier of work, you need to respect the law.