The days of the traditional 9-to-5 unionized job with benefits where a worker could expect to stay with the same company for 30 or more years is slowly becoming a thing of the past. The freelance workforce economy is being fueled by millennials who are experiencing corporate downsizing, changing economic conditions, and job dissatisfaction. It’s time for politicians to take notice of this trend.
Workforce survey
Upwork and the Freelancers Union commissioned an online independent workforce survey involving over 6,000 adults who received payment for all work done over the past 12 months. Data for this survey was collected this year from July 29 to August 24, and this is the third year in a row this survey has been conducted. The researchers define freelance workers as anyone who earned an income for doing temporary, supplemental, contract, or project-based work. Non-freelance workers are defined as anyone who earned an income in a way that is not defined as freelance work. The goal of this survey was to see how many people are doing freelance work, why they are freelancing, assess the role freelance workers have in this year’s presidential politics, and assess the future of freelance work.
The growth of freelancing
Freelancer stats shows around 55 million people do freelance work, which represents 35% of the total workforce. The number of people who have done freelance work has increased by one million people each year for the past three years. 63% of the people who do freelance work are doing it by choice rather than necessity, and they are motived by the freedom and flexibility of the freelance lifestyle. 79% say freelancing is better than working a traditional job because they feel more respected, engaged, empowered, and excited about the work they do. Freelance earnings are estimated at around $1 trillion, which is a significant contribution the overall U.S. economy.
The survey classified freelance workers into five categories:
- Independent contractors – They don’t have an employer and work on a project-to-project basis. Independent contractors represent 35% if the freelance workforce.
- Diversified workers – 28% of freelance workers earn an income from multiple sources including traditional employers. Typically, they will work for a traditional employer part-time, then work a part-time freelance job.
- Moonlighters – These workers make up 25% of all freelance workers. Moonlighters have full-time traditional professional jobs by day, then spend a few hours in the evening or on weekends doing paid freelance work.
- Freelance business owners – Around 7% of all freelance workers own a business with one or more employees, but they still identify with being a freelancer.
- Temporary workers – 7% of freelance workers are temporary workers who receive short-term assignments through a staffing agency.
Since 2015:
- The number of independent contractors is down one percentage point
- The number of diversified workers and freelance business owners is up two percentage points each
- The number of moonlighters and temporary workers is down two percentage points each
Reasons for doing freelance work
There are many reasons why people choose to do freelance work, and full-time freelance workers have different reasons than those who do this part-time. Three reasons are:
- To be my own boss – 77% full-timers / 60% part-timers
- Flexible work schedule – 73% full-timers / 65% part-timers
- Work from any location – 72% full-timers / 61% part-timers
Other reasons include choice in projects, pursuing other passions, control of financial future, independence, and more family time. When it comes to earning more money, part-timers chose this reason more than full-timers by 74% to 68%. On average, freelance workers work 36 hours per week, and 52% are happy with the amount of work they have.
Freelance workers and politics
Every presidential election is important, and the one that just passed was no different. The nation’s economy and the job market are going through a long transition period where workers don’t stay with one company for 30 or more years and work 9-to-5. This may still be the case in the public sector, but in the private sector, the job market is much more fluid and innovative. Republican and democratic politicians neither talk about nor seem to understand the growing freelance worker economy and its impact on the nation’s economy, and this is frustrating to freelance workers.
In the workforce survey, 85% of freelance workers say they are likely to vote in the 2016 presidential election, but 69% say they wish the candidates would talk more about the freelance job market. 68% said they are more likely to vote for the candidate who talks about the freelance job market and supports the interests of freelance workers regardless of the candidate’s party affiliation. Freelance workers would like to hear the candidates talk more about issues affecting them like having better access to health care, retirement benefits, and credit, and providing safeguards to make sure clients pay for the work provided. Over 85% of freelance workers find these political issues important:
- The job market
- Healthcare
- Education
- Terrorism and crime
- Trade
Personal concerns for freelance workers include unpredictable income, competition from large businesses and other freelance workers, being paid a fair rate, and high taxes. Many freelance workers believe politicians should do a better job of learning about the freelance workforce and develop an educational environment that will prepare students for a freelance work environment.
The future of freelancing
Perceptions about freelancing have improved over the past few years, and more people believe freelancing is a legitimate career path. Freelancer stats shows 84% of the survey’s respondents have a positive view of the future of freelancing, and 86% say they expect to have more freelancing job opportunities. 46% say they have experienced an increased workload over the past year, which is up 14 percentage points from 2014, and 51% say they expect to see a future increase in income. Although they work on average less than 40 hours per week, 79% say they earned more money freelancing within a year after leaving their traditional jobs.
How is this all happening? 73% of survey respondents say technology has made it easier for them to find work and invoice clients. Most people still find freelance work through traditional means like family and friends, professional contacts, previous employers, local newspaper classified ads, and employment agencies, but finding work on the internet is a growing trend. Online classified ads, job boards, marketplaces, specialized freelance websites, and social media are all contributing to the growing presence of freelance jobs. Freelance workers have such a positive outlook on their career path that 50% say they would never go back to a traditional job no matter how much they are offered.
Millennials are leading the trend towards freelance work. 47% of those who are 18-21 years old and 43% of those who are 22-34 years old are doing freelance work. Freelance workers are evenly split between male and female, and they represent all educational backgrounds. 47% of freelancers live in suburban areas, and 40% of them live in the south. Freelancing is no longer just about doing temp work. The freelancing workforce involves people of all socio-economic, age, and racial backgrounds who are increasingly professional and strategic in planning the work they want to do. This appears to be a sustainable trend, and politicians and business leaders need to rethink their worldview about the changes that are occurring in the workforce.
