Is Freelancing an Act of Desperation? | DCR Workforce Blog

Is Freelancing an Act of Desperation?

FreelancingIn what most people would consider click-bait, Fortune ostensibly supported Donald Trump’s claim on CBS that Americans are living in a false economy where the unemployment rate is actually 40.6% and not 5.1%. Fortune also retracts this claim in the same piece, by noting the social reasons which make people in the population over the age of 16 remain unemployed. The public is smart enough to form its own opinion of the state of the economy based on its own observation and personal experience. It had been said that all politics are local. This is certainly true when it comes to employment as each of us view the health of the job market – whether positive or negative – by our own experiences!

Against this background, there is a clear shift toward freelance work. The Government Accountability Office (GAO) estimated that 40.4 percent of U.S. workers are in contingent or alternative work arrangements. Of these, freelance workers come in different forms. They could be independent consultants/contractors, self-employed, or small business owners with fewer than four employees. It is difficult to estimate how many workers are taking an active part in the freelance economy in America. According to a survey of independent workers in the U.S.A. their number is estimated to stand at 17.8 million or 12% of the total workforce as of now, a number which is not static. Another survey conducted by Edelman Berland and commissioned by Freelancers Union and Elance-oDesk reveals that freelancers and consultants consist of more than 53 million or one third of all U. S. workers.

New freelancing positions are emerging. Any services relating to writing, graphics design, and software programming have always been widely served through freelancers. We can now add IT security, online marketing, virtual assistants, translators, transcribers, trainers, accountants, legal service providers, and many more.

Traditionally, a strong job market was seen to encourage workers to give up their independence and take up regular full-time jobs. It also encouraged employers to generate more permanent positions. While this remains true, we have also seen the growth of individuals pursuing freelancing by choice rather than necessity.

Freelancing as a choice

Workers who choose freelancing over regular employment cite a need to enjoy flexible work hours, a wish for creative freedom and a desire for a better work-life balance. Changing technology is making it possible for more workers to adopt new delivery models in freelance work. Using their phones and laptops, workers can work anywhere, at any time, while meeting the needs of those who retain their services. Further incentive comes from rising incomes of highly paid independent contractors in professions like law, accountancy and other technical and professional positions. Also, the growing use of social networks and online platforms as effective marketing tools have lowered the cost of establishing oneself in a lucrative opportunity.

Freelancing as a necessity

For others, freelancing continues to be a way to provide financial security during a period of unemployment or to establish work credentials in order to pursue better opportunities. While the economy has improved, job growth has not kept pace for all professions and in all areas of the country. Many workers have ceased all attempts to find traditional employment and turned to independent and freelance roles. Freelancing also serves as a way to continue to enhance one’s work resume while overcoming the bias against hiring someone who is unemployed.

It’s no wonder that the number of freelancers in America is seen to be slowly but surely increasing. Can we extrapolate this growth to predict the future structure of the workplace or expect some of these factors to change, thereby altering its course again? Not entirely. We still have an incomplete picture of the drivers of freelancing. Freelancer estimates fail to sort out the number of individuals who hold a permanent position and also freelance to create a second income or to use freelancing to “test the waters” before launching a new business. In assessing motivation, we fail to account for those who are initially driven by necessity, but enjoy the experience enough to continue after permanent opportunities are available.

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The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.