Executive Summary
We are delighted to publish the 6th year of our annual Ireland’s Project Economy Report.
If there is one main finding that has emerged over this period it is that the self-employed independent contractor workforce – which comprises workers with career paths with more risk and uncertainty than employees – transposes into a dynamic, robust and high performance economy. While being dynamic and entrepreneurial, the project economy has in fact stable and enduring characteristics that place it at the top tier of Irish economic performance.
Independent contractors that comprise the project economy are highly skilled and high impact. They are consistently a deeply educated workforce with well over 90% having a university degree or professional equivalent qualification. They derive the highest economic valued added from work experience. In fact, so much so, that they are capable of confining the once assumed general stylised fact of an inverse U-shaped relationship between age and earnings to be an employed-sector phenomenon. Our research over the last six years has shown that this relationship doesn’t hold true for self-employed independent contractors in the project economy, where it is replaced by an increasing monotonic relationship so that older more experienced workers always earn more than younger and less experienced counterparts. This result holds true across all age groups. Indeed, regardless of the rapidly changing technologies and business practices in recent years where one might imagine that the value of work experience quickly depreciates, independent contractors have proven themselves to be exemplars of a growth mindset, using new work experience to constantly evolve and enable a productivity and pay premium for more experienced workers. So our latest survey finds that the over 60 year olds – who have the most work experience – earn the largest premium over equivalent employees with 72% more in annual earnings.
However, regardless of age and experience our research consistently finds that the project economy generates the highest quality jobs. High-skilled independent contractors continue to manifest the high pay and job satisfaction levels compared to other forms of work. In our latest survey they earn €34,344 more than equivalent (managers, directors and professional) employees giving rise to a 41% independent contractors pay premium over employees. However, this has narrowed this year as the pay increases in the employed sector have not being matched by independent contractors.
Likewise, while job and life satisfaction levels remain very high compared to employees, we observe an uptick in burnout and loneliness amongst independent professionals mostly concentrated in the younger age groups. We don’t have contemporaneous well-being data for employees in Ireland so are not able to ascertain if this is unique to independent professionals or a general labour market feature.
Confidence in the Irish economy is still positive but close to zero (+6) indicating only a slight majority of independent professionals who expect economic conditions to improve further in 2026. Independent professionals are more upbeat about the prospects for the economy but this confidence is not as high as in previous years indicating a weakening in an albeit positive business outlook. This would tally with a more demanding business environment, not only supported by the well-being scores above but also in an increase of 17% in time spent looking for a new contract – up from 12 days last year to 14 days in the latest survey. This too corroborates with the fact the day rates while constant in nominal terms have fallen in real terms and the ability for the high skilled gig economy to close some of the pay gap with the project economy (a sector which is over 6 times larger and dominates our survey results).
Finally, given the high value added and impact of work in the project economy, we decided to expand our study this year by asking independent professionals about the role of leadership in their work. This was also motivated by the fact that nearly all studies on business leadership focus on employees and given the heterogeneity in the workforce we felt that one cannot assume that the lessons from employed sector automatically carry over to the high skilled self-employed. And it turns out this was a good guess! Independent contractors are generally quite impressed with the leaders guiding work in the project economy. They tell us that their leaders are effective in driving organisational performance and are satisfied with the manner in which their leaders work with them. In achieving this performance, independent contractors observe their leaders adopting a blend of directive and collaborative leadership styles – not one or the other. This ambidextrous leadership capability also manifests through a combination of clear direction but which then gives contractors autonomy and an opportunity to collaborate with a leadership characterised by good teamwork, transparency, inclusivity and authenticity. The message for leaders of independent contractors seems clear. If you want to get the best out of independent contractors, make performance objectives clear but then trust them to collaborate with the rest of the team with a leadership culture where people have the confidence and freedom to be themselves in order to let their talents shine in an inclusive, open/transparent and authentic manner.
Written By
– Professor Andrew Burke, Chair Of Business Studies At Trinity College Dublin
– Professor Na Fu, Chair of Responsible Leadership at Trinity College Dublin
