Not only is today’s economy a sharing one, but it also seems to be a freelance economy, where more people are working for themselves and carving out a unique work-life balance while providing companies and startups with access to talent on demand. In this post we’ll dive into the State of Freelancing in 2015.
To illustrate the radical shift in the workforce, here are some of the latest freelancer statistics that define and quantify the state of freelancing today:
Size & Scope
To give you an idea of the size of the U.S. freelancing market, there are now 53 million people in the U.S. contributing $715 billion in earnings to the national economy, according to a report by the Freelancers Union in partnership with Edelman Berland. The demand and amount of work is actually growing for about one-third of the total freelancing group.
Freelancing is not just a U.S. phenomenon, but is now spreading around the world. For example, a 2011 report by the All Party Parliamentary Group and the Professional Contractors Group in the UK found that freelancing is growing within the country. This includes 1.4 million people now working as freelancers and adding considerable value to the UK economy while promoting a good work-life balance and family life for those participating in this career.
Another report on the state of freelancing in the European Union found similar results. Referring to them as iPros, the report concluded, “iPros are highly skilled self-employed individuals who work for themselves but do not employ others. They range from journalists and designers to ICT specialists and consultants. iPros represent a significant segment of professional working generally, making up 25% of all those working in professional, scientific and technical work and 22% of all those in arts and entertainment. The growth in iPros in the EU since 2004 has been remarkable. Numbers have increased by 45% from just under 6.2 million to 8.9 million in 2013, making them the fastest growing group in the EU labor market.”
In the 2012 Freelance Industry Report, 78% of the participants were based in North America while 11% live in Europe, 5% are from Asia and 3% are from South America. Just a total of 3% of all the participants live collectively in Africa, Australia, the Middle East, Oceania, Central America, and other regions.
Motivation & Challenges
According to Edelman Berland, 80% of those surveyed who are not currently in freelancing said they would do extra work on a temporary basis just to make more money. Many who do work full-time and see others making a living in freelancing are now considering moving from a moonlighting position in freelancing to full-time status as captain of their own careers. The other advantage noted for migrate to the freelance economy is the flexibility.
The 2012 Freelance Industry Report concurred with many of these other reports in terms of the motivations and benefits related freelancing. The report noted, “Having more flexibility in their schedule was the top (25%) freelancing benefit listed by respondents. Other top benefits cited were variety in work (15%), being your own boss (14%), the ability to work from anywhere (14%) and the ability to make your own decisions (9%).”
However, the majority also noted the constant struggle with freelancing, which centers on income stability and the ability to find work. When they do find work, freelancers noted that they work continually because they are never sure when the work will dry up and they will have to search out more. Another study of freelancers by CreditDonkey found similar challenges, but also added the difficulty in finding clients, the constant hustle to find work, the opinion of friends and family who do not consider it a “real” job, or and problems with getting paid.
Beyond the already acknowledged challenges listed in other surveys, those that participated in the 2012 Freelance Industry Report also listed other struggles, such as “getting affordable health insurance (4%), getting out of the money-for-time cycle (4%), staying motivated throughout the day (3%), growing beyond a one-person business (3%) and combating isolation (2%).”
Technology has changed everything, and that is essentially what created the freelancing opportunity. Of those surveyed by Edelman Berland, 69% explained that it is technology, including the internet and social media, which have made it easier to find work that is now available from all over the world and create a new type of career. The study also noted that technology has sped the amount of time spent on finding projects or assignments with more than half finding an online assignment within three days while one-quarter of those surveyed can actually find work within 24 hours.
Types & Segments for Freelancing
According to Edelman Berland, there are five primary segments for freelancing. These include independent contractors (40% of freelancers), moonlighters (27%), diversified workers (18%), temporary workers (10%) and freelance business owners (5%).
CreditDonkey broke down the types of freelancing and found that the majority of them (42.3%) work in creative services, which includes writing, graphic design, and photography. The next biggest segment of freelancers is those who provide operational support (30.5%), such as data entry or virtual assistants. Other freelance work includes childcare, tutoring, real estate, professional or trade services, and fitness instruction.
Demographics of Freelancers
To get a clearer picture of what freelancers look like, a 2012 Freelance Industry Report collected some specific demographics about today’s typical freelancer. The majority of freelancers are women (71.1%) while men comprise 28.9%.
There does not seem to be a significant majority of any age range. According to the survey, 12% of respondents were 60 or older, and 12% were in either their teens or 20s. The largest represented group in the survey was the 30 – 39 segment (26%), closely followed by freelancers in their 40s (25%) and 50s (25%).
The freelancers in the market have a great deal of experience, with 34% having 10 or more years of experience freelancing. Ten percent are new freelancers who have only been doing it for a year or less.
Earnings report healthy incomes among those in the freelancing trade. While there is a significant range, depending on the type of freelancing work and level of experience, the 2012 Freelance Industry Report found a concentration around the $20 – $59 per-hour range, with 49% of freelancers falling into this category. After that, 33% of freelancers earn anywhere from $70 to $200+ while 15% are earning $100 or more per hour.
In terms of billable rates by profession, the report noticed the following averages: “For designers, the biggest cluster was in the $50 – $79 per-hour range. For writers, it was $50 – $69. Editors were heavily concentrated in the $20 – $49 range. More than half of translators were in the $20 – $39 range.
And the most concentrated range for web developers was $30 – $59.”
Freelancers who participated in the Edelman Berland survey appeared to remain positive that this career path will only get better, with 77% saying that the future will only see the opportunities grow.
Over two-thirds concluded that freelancing is now more respected than three years ago when the general consensus was that a freelancer was a slacker who most likely watching television or sleeping when others were putting in a 9-to-5 workday.
The state of freelancing is about growth, potential, opportunity, economic health, and work-life balance across the globe and throughout all demographics.
As more organizations and workers recognize the value of this career path and as technology continues to facilitate this type of work, the future of freelancing will only get brighter.