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Cover image for The state of freelancing in 2018

The state of freelancing in 2018

damcosset profile image Damien Cosset ・4 min read

Introduction

Every year for the last 5 years, Upwork and the Freelancers Union have commissioned a survey in the United States. The goal of these surveys is to have a better understanding of the independent workforce in the country. The study has 4 objectives:

  • Quantify the number of people freelancing in the US and their economic impact.
  • Assess the state of freelancing, especially current demand for freelance services.
  • Gather insights into drivers and barriers impacting freelancing
  • Gauge the outlook for freelancing, especially among millennials as they become the majority of our workforce.

This study is focused on the United States workers. While many of us might not be concerned by the state of freelancing in the US, I believe we can draw some conclusions about the state of freelancing elsewhere as our economies become more intertwined.

Definitions

First, we need to define some terms.

  • Freelancers: Individuals who have engaged in supplemental, temporary, project or contract based work, within the past 12 months.

The study differentiates 5 flavours of freelancers:

  • Diversified workers: People with multiple source of incomes from traditional jobs and freelance work. Someone working part-time in a company and writes code as a freelancer on the side while managing an AirBnB.

  • Independent contractors: Traditional freelancers who do not work for an employer and do freelance, temporary, project or contract based work.

  • Moonlighters: People with a traditional, primary job who also do some freelancing on the side. An corporate-employed accountant working for non-profits on the week-ends for example.

  • Freelance business owners: These freelancers have employees but still consider themselves freelancers.

  • Temporary workers: People with a single employer, client, job or contract project where their employment status is temporary.

What the numbers say

Ok, so now we know what we are talking about. Let's pull some numbers from this survey that I found interesting. Many of these numbers are compared to the first survey conducted in 2014 to see how freelancing has evolved.

Numbers of freelancers

There are today 56.7 millions freelancers in the US workforce, which represents 35% of the entire workforce. There are 3.7 millions more freelancers compared to 2014.

Diversified workers and independent contractors represent the majority of freelancers, with 31% each. Moonlighters represent 26% of the freelancers workforce, freelance business owners and temporary workers represent 6% each.

Who, What and How?

  • 28% of the US freelancers are full-time freelancers. (17% in 2014)
  • 43% are between 18 and 34 years old. (32% in 2014)
  • 61% started freelancing by choice, not necessity. (53% in 2014)
  • 31% earn more than 75000 $/year. (16% in 2014)
  • 42% freelance less than weekly.
  • 48% see freelancing as a long term thing. (35% in 2014)
  • 74% started in the last 5 years. (70% in 2014)

Training

  • 70% of freelancers participated in training in the last 6 months. (49% among the non-freelancers)

Freelancers look for their training themselves (online forums, books, websites...). Non-freelancers train mostly on the job.

Among the freelancers who graduated from college, 93% found skill related education/training useful to the work they do now. Only 79% of those freelancers found the the college education useful to the work they are doing now.

Most freelancers find the cost of training and skill education too high. (53% vs 33% for non-freelancers)

Many freelancers would benefit from education on essential business skills. For example:

  • 44% of the responders did not agree with the sentence:

I have a good contract that I use for my freelance work.

  • 36% did not agree with the sentence:

I know how to effectively market my skills.

Work and Life

A large majority of freelancers and non-freelancers give the priority to their lifestyle, compared to earnings. However, 84% of full-time freelancers say that their work allow them to have the lifestyle they want. Only 63% say the same thing for non-freelancers.

  • Freelancers enjoy the flexibility and independence they have.
  • The biggest worries for freelancers are income predictability, difficulties in managing their businesses and isolation.
  • Freelancers report they are feeling less stressed, more stimulated and healthier compared than when they have a traditional job.

Freelancing provides opportunities to people unable to work in a traditional job because of health or family issues. 29% of the respondents said a traditional job would not work for them because of health issues. 22% because of a family related issue.

Looking ahead

  • 59% of the freelancers estimate that the freelancing job market has changed compared to 3 years ago. (only 42% said the same thing in 2014).

  • 87% of freelancers think the best days are ahead. (vs 77% in 2014)

A large majority of freelancers (76%) admit that technology makes it easier to find work. Almost 2/3 (65%) think there is a higher demand for freelancers over the past year.

Freelancers find work through multiple sources. Friends and family are the most frequent source with 46%, social media with 40%, previous clients with 38% and professional contacts with 36%. These are the four more frequent ways freelancers will find work nowadays.

  • A good majority of freelancers find work online (64% vs 42% in 2014)

  • 82% of non-freelancers admit they would be open to freelancing on the side to make extra money.

  • Among the freelancers who left a traditional job to freelance, 60% earn more money. Among those 60%, 77% took less than a year to have an superior income than their former job.

  • Half the freelancers today say they wouldn't go back to a traditional job, no matter how much money they were offered.

Conclusion and Sources

Freelancers are already a huge part of the workforce. They will most likely become the more important part of the workers in the future. This series of studies might help us understand what freelancers are expecting from our society, where they come from and how they can help our economies.

Below, you will find the links to the slides for the surveys from year 2014 to 2018. In each, there is a section about politics. Freelancers might very well become a crucial part of the electorate in the future.

Sources:

2018 Survey
2017 Survey
2016 Survey
2015 Survey
2014 Survey

Discussion

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jorgecc profile image
Jorge Castro

Ahem, in a nutshell: about programmers

  • The average salary of an American is $7K USD per month
  • The average salary of a Chinese is $2K USD per month
  • The average salary of a Hindi is $5k USD per year

https://equity.guru/wp-content/uploads/2018/11/done.gif

You could earn more working at McDonald.

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darryldexter profile image
Darryl D.

Let's not forget that this is mostly supplemental income, not primary. Also the convenience factor of working from home only makes it better.

An extra 7k a month in addition to your current pay is a nice addition.

(been freelancing in addition to salary work over a decade now)

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damcosset profile image
Damien Cosset Author

Would you consider making the leap to full time freelancer? Or would you consider it too risky?

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jorgecc profile image
Jorge Castro

I work as a freelance thanks because I have earned customers and right now, I am working with two customers. However, those online platforms are not alternative, it's easy to earn money working 9 to 5 (9 to 6 in my country) than working online for, how about $4-$5 per hour. So, if you have the customers then go ahead, and go for freelance, otherwise no.

There are some stories about a guy that earned over $500k USD but it is not the average, the average is around $300 per month if not less.

Also, the work as a freelance is anything but stable, it requires a lot of expertise and sometimes it requires working the weekend. I won't recommend because it is possible to earn money working normally: less stress, less work, and a stable income.

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darryldexter profile image
Darryl D.

I go full time all the time so it's not about risk. I just like the balance depending on how my life is going at the time.

At this point in my career, jobs for me are just freelance gigs with benefits :)

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damcosset profile image
Damien Cosset Author

I am not familiar with McDonald's salaries. But 7k seems like a higher income that what you would get at a fast food flipping burgers no?

About these studies, keep in mind that only a third of the respondents freelance full time. I am not familiar with the Chinese or Hindi freelancers market job.

Thanks for the numbers :)
May I ask the studies on Chinese and Hindi freelancers rates? Very curious to read about that!

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jorgecc profile image
Jorge Castro

Of course, the salary of Mcdonalds is an exaggeration or is it not?

But let's say that somebody flipping burgers earns $10 per hour. And 270 working days per year, 8 hours per shift, 10x270x8 = $21k per year or about three times what a Hindi earns.

And you could find more information on the net. However, I suggest you find information on UpWork (Upwork+low+pay for example).

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Vitali Pomanitski

In one word NOT Good.
Looking at the freelancer I was hiring and at the level of work I was doing back then in 2010, no promising work projects for the good onces and no fulfilling for all the requirements I was setting as an employer as for today. I see a good movement tendency towards the open source projects as for upcoming 2020, the new Global Home for all, G5 and the empowering Internet. I think the World Wide Web has the new capabilities for handeling the new kind of people who are looking for growing out of the box from their early 5yrs olds.
As for my success as a freelancer, I also was not a 1st class.