Empowering Idaho’s self-employed workforce with portable benefits

Note: This is a joint op-ed with Liya Palagashvili of the Mercatus Center at George Mason University.

Across Idaho, more than 160,000 people earn income—whether as a primary or supplemental source—through self-employment, contract work, or small business ownership. They include truckers, delivery drivers, freelance creatives, childcare providers, and self-employed farmers and tradespeople who remain central to Idaho’s economy.

Together, they generate over $9 billion annually, according to U.S. Census Bureau data. This independent workforce reflects Idaho’s spirit of self-reliance and enterprise — yet labor policies haven’t kept pace with the way people earn a living today.

Much of Idaho’s workforce turns to self-employment because that’s how many local industries operate — from agriculture and construction to family-run services and trades.

For others, independent work offers the flexibility to manage their time, earn income on their own terms, and pursue family, education, or creative goals. According to the Bureau of Labor Statistics, more than 80 percent of independent workers prefer their current arrangement, and fewer than 9 percent say they’d rather have a traditional employee job.

But self-employment comes with tradeoffs. The same independence that defines this kind of work can also leave people without basic protections. Under current laws, self-employed workers often go without benefits like health coverage or retirement savings — and even when companies or clients want to offer them voluntarily, they’re discouraged from doing so because of legal uncertainty. 

Current labor rules risk treating those arrangements as formal “employment,” triggering costly liabilities. As a result, many businesses or clients avoid offering benefits altogether. Surveys show that 81 percent of self-employed workers want portable benefits solutions — ways to access benefits while keeping the independence they’ve chosen.

That’s where portable benefits come in. Portable benefits would travel with workers as they move between jobs, clients, or projects — benefits that belong to the individual rather than a single employer. Picture a truck driver, a freelance designer, or a self-employed farmer who receives contributions from each company or buyer they work with — funds that accumulate in a personal benefits account they can take with them from job to job.

This reform isn’t about changing what makes self-employment appealing. It’s about expanding access to financial security while preserving the independence and initiative that define Idaho’s self-employed workforce. Lawmakers can make that possible by establishing safe harbor provisions that allow companies or buyers to voluntarily offer benefits without fear of reclassification. 

With its entrepreneurial economy built on small businesses, family farms, and independent trades, Idaho is uniquely positioned to lead — and modernizing its labor laws would help workers thrive on their own terms. While other states, such as California, have moved in the opposite direction with restrictive reclassification laws like Assembly Bill 5—leading to measurable declines in self-employment and disrupting industries such as trucking and the creative arts—Idaho can instead embrace policies that expand flexibility and opportunity.

Supporting voluntary portable benefits would reinforce Idaho’s commitment to economic freedom, entrepreneurship, and individual opportunity.

Across the country, momentum for portable benefits is gaining traction. States such as Utah and Tennessee have advanced proposals to modernize labor laws and enable voluntary benefit programs for self-employed workers. In other western states, including Nevada and Montana, similar bills have been introduced in the past year. At the federal level, proposals in Congress would create similar safe harbors, allowing innovation at scale. After years of debate about how to support nontraditional workers, policymakers are finally beginning to act.

What’s notable is that these workers aren’t asking for government mandates or subsidies. They’re asking for the freedom to participate in modern systems of security without sacrificing the independence they’ve chosen. Portable benefits meet that need — offering stronger financial security without compromising the initiative and determination that define Idaho’s workforce.

By removing outdated barriers to voluntary portable benefits, Idaho can prove that independence and security not only coexist — they make each other stronger.

Liya Palagashvili is a senior research fellow and director of labor policy at the Mercatus Center at George Mason University. Jason Mercier is Vice President and Director of Research of Mountain States Policy Center.