The Freelancing in America survey, commissioned by Freelancers Union, oDeskand Elance, found that there are 53 million Americans who fall under the definition of a freelancer. The study also broke down the freelancing segment of the American workforce to discover who they are, why they freelance and how they feel about the future of freelancing.
But while the study did offer some interesting facts, the question still remains: Is freelancing a viable career option that can support you full-time?
When searching for an answer, the numbers suggest that compared to a traditional job, freelancing is still a difficult career to take on. The good news is things may be changing. To understand the reasons why, it is important to dive deeper. To begin, the study defined what a freelancer is and broke down the freelance workforce into segments.
The 5 Types of Freelancers
The study defined freelancers as “individuals who have engaged in supplemental, temporary, or project- or contract-based work in the past 12 months”; it then broke down respondents into five different types of freelancers.
- Independent Contractors: This group is made up of 21.1 million freelancers (40% of all freelancers) who take on work in the form of projects, whether they are full-time or on a temporary or supplemental basis. This group is known as “traditional” freelancers who do not have an employer.
- Moonlighters: These 14.3 million freelancers (27%) have a primary job but take on additional freelance work in their spare time. A marketing professional at a large company who also takes on a marketing project for a friend’s startup would be a good example.
- Diversified Workers: This group of 9.3 million (18%) is made up of people who support themselves with several sources of income, whether it’s working part-time at a traditional company or doing supplemental work during the weekend.
- Temporary Workers: The 5.5 million people (10%) in this group take on temporary work, either full-time or part-time, with a single employer or client. Consultants often fall into this category as long as they are not employed by a larger consulting company.
- Freelance Business Owners: The 2.8 million professionals (5%) that fall into this group consider themselves freelancers but also employ one to five employees depending on the project they undertake.
The five types of freelancers indicate a broad spectrum of professionals. People with full-time traditional jobs, temporary jobs and even small business owners can be considered freelancers if they fall under the definition. But the actual number of people that are supporting themselves with only freelancing is unclear. Independent contractors and freelance business owners do not have any other sources of income, implying that they are making a living through freelancing alone.
It is clear that moonlighters and diversified workers are not making a living from single projects, and they’re making at least part, if not most, of their income from full-time or part-time employment.
A telling statistic is found in why people become freelancers. With 68% of respondents becoming freelancers to “earn extra money,” it is implied that they use the freelance work to supplement other income sources. The good news, however, is that for a third of respondents (32%), the demand has risen in the last year, and 38% are expecting to work more hours. The opposite was true for the 15% who saw demand decrease and the 12% who expect to work fewer hours.
When it comes to income, there is even more good news. About 43% expect to make more money in the coming year, while only 11% expect their income to decrease. Interestingly, 77% said they make the same or more money than they did before they started freelancing, with 42% saying they make more. It is unclear, however, how long it took these respondents to start earning more money, and if that amount was significant or not. The only conclusion we can draw is that, for many freelancers, their earning potential is increasing.
The survey also left out important information about the challenges and barriers to freelancing. While 50% of part-time freelancers and moonlighters claimed that “a lack of stable income” was a key barrier, it is not clear if this is a problem for full-time freelancers.
The Future of Freelancing
The results showed that freelancers are generally optimistic about the future of the freelance job market, with 77% feeling good about the year ahead. They also believe that freelancing garners more respect than it did three years ago, with 65% agreeing with this statement.
Conclusion
If you are considering leaving the traditional workforce and joining the freelance movement, the evidence suggests that it is still an uphill battle to support yourself full-time from freelancing alone. Stability still lies in having a traditional job when compared to a project-based career.
As the freelancer population grows, it is not clear if the opportunity to make a decent living by only freelancing is growing or shrinking. At some point, it simply becomes an issue of supply and demand. Even if there was an increase in demand for freelance work, prices per projects would be driven down as more people enter the freelance workforce. Because of this, it is very important to understand that becoming a freelancer is a lot like becoming a business owner. You will need to be prepared to sell and market yourself and grow your client base through hard work and dedication.
There is reason, however, to be optimistic about the future. With companies such as Elance and oDesk, it is becoming increasingly easier to join this growing segment of the American workforce. And with organizations such as the Freelancers Union taking root, there are institutions being formed to protect freelancers’ interests, such as creating access to health insurance and other benefits. If this trend continues, opportunities for freelancers will continue to grow as the landscape of the American workforce continues to change.
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