5 reasons freelancing is the future of work

Industry analysts have predicted that freelancing is the future of work for years. They pointed to the fact that freelancers made up a third of the global workforce, 1.1 billion of the 3.5 billion workers in 2019.And in the six years leading up to 2020, the number of people who identified as long-term freelancers not just those supplementing their income increased by more than 50 percent.

Then the pandemic happened. 

For freelancers, it was the moment of truth. Could contract employment survive? 

Data published by Payoneer indicate that it has. And an influx of talent to freelance platforms such as Work for Impact suggests that its only growing.

Heres why freelancing is the future of work even after the pandemic, and maybe even because of it. 

As jobless rates skyrocketed in the spring of 2020, many people found themselves out of work, especially workers under 40. According to a report by the U.N. in December of that year, as many as one in six millennials had lost their jobs. 

As a result, many formerly full-time workers picked up freelance jobs. Some took jobs in the same sector or used the same skill set as their former full-time job. Others learned something new entirely. 

Freelance roles rarely require a degree or years of experience. Thanks to platforms such as GeniusU, LinkedIn Learning, and Udemy, freelancers can quickly learn on-demand skills and use them to attract and win clients.

What about people who were freelancing before the pandemic, didnt their income take a beating? Initially, yes. Freelancers globally reported an immediate drop in income. But by the summer of 2020, many said their earnings had returned to pre-pandemic levels. 

Payoneer published a report on the state of freelancing during COVID-19. It found that freelance hourly rates remain stable in spite of the crisis. And as many as 17 per cent of freelancers actually saw their business increase. This even factors in the influx of freelance talent to the marketplace.

Outsourcing has become one of the most promising industries for young entrepreneurs in Ukraine. Ukrainian specialists can compete on equal terms with service providers from all over the world, and in fact, theyre doing very well, says Michael Deinega, Payoneer Country Manager in Ukraine. Ukrainian IT outsourcing companies are definitely feeling the impact of the crisis, but perhaps less so than other markets due to the high quality and more affordable rates they offer over hiring locally.

As many as 64 percent of freelancers find their jobs online, and few if any of those require a freelancer to be on site. For digital nomads, this means travel. But during a pandemic, it means we can hunker down wherever we live and not be limited to the local market. 

For Beatrice Fossati, who manages social at Work for Impact, the pandemic struck just a few months after she launched her freelance career. By the end of February, as I was managing my first projects, COVID-19 exploded in the northern part of Italy, and two weeks later we were all in lockdown, she says. 

Initially, she dove into work, logging 10 to 13-hour days because, what else was there to do? But eventually, she came to prioritise work-life balance.

Being your own boss means also being able to realise when your energy is low, she says. We shouldnt forget that time to recharge batteries is as important as working.

Hourly rates for freelancers can be three to four times higher (or more) than hourly rates for employees. Part of that cash gets gobbled up by taxes, insurance, and maintaining our own equipment. But after those expenses, the rates are still higher than what an employee in a full-time role makes.

Freelance rates vary widely by discipline, with freelance IT professionals in the U.S. earning on average $49USD an hour whereas a freelance administrative or customer support person earns $29USD work for U.S.-based companies. 

Overall, the global median hourly wage for skilled freelancers was $28USD an hour. For unskilled freelancers, the median hourly wage was 20 USD in 2020.

One of the greatest advantages of being a freelancer is deciding whom you want to work with. You can reach out to companies whose vision aligns with your own and get to work on a wide variety of exciting projects. 

At Work for Impact, thats one of our driving ambitions to make meaningful opportunities available to freelancers in every corner of the world.

Click here to sign-up to Work for Impact and find meaningful freelance projects