whererealizationspend Recent research from Upwork shows that 26% of American freelancers now have a graduate degree, up from 20% a year ago.
Because millions of Americans are increasingly choosing to work for themselves by launching their businesses or hiring independent contractors, employers are having problems filling vacancies.
According to the U.S. Census Bureau, Americans applied to start 5.4 million new businesses in 2021, the most significant number ever recorded and a 68% increase over the average for the previous five years. Additionally, millions of people are resorting to freelancing. Roughly 87 million Americans, or up to half of the workforce, will be independent contractors within a few years.
Additionally, the tendency is gaining momentum, according to recent statistics from the freelance marketplace Upwork. According to the survey, 39% of the American workforce engaged in freelance work in some capacity during the past year (an increase of 3% yearly), contributing a staggering $1.35 trillion in profits to the national economy.
The growing number of full-time freelancers comprises more than only those who have recently lost their jobs due to layoffs or other means. As evidenced by the fact that 43% of Gen Z professionals and 46% of millennial professionals freelanced in the last year and that 26% of all freelancers hold a postgraduate degree—up from 20% last year—young, educated employees are frequently the ones going it alone.
What caused the change? According to Margaret Lilani, vice president of talent solutions at Upwork, changes have occurred in both our communal sense of work practices and our understanding of independent labor (as well as the epidemic, of course). “We ascribe [the rise of freelancing] to a broad shift in the workforce, where people are for the first time rethinking the traditional ways of working,” adds Lilani. The pandemic spend what would have likely been a more gradual adoption, enabling this mass realization.
“Skilled professionals are aware of the advantages freelancing affords them in terms of their jobs and personal lives. They are a part of this enormous “ah-ha” that makes people question the limitations of a typical 9 to 5. Freelancing also provides flexibility and control that a typical job cannot for people looking for something different, according to Lilani.
Independent contractor organizations assert that a surge has been seen in recent years. According to Rafael Espinal, executive director of Freelancers Union, a nonprofit organization with 500,000 members across the United States that offers advocacy, benefits, and services, “weekly membership roles have climbed 300% every week compared to 2020.”
He claims that more and more people are making the switch to freelancing.
EVALUATING REWARDS VS. RISKS
Freelancing comes with a lot of risks, despite its increasing popularity. Many workers must weigh the benefits and drawbacks of switching to a freelance profession after leaving a full-time position, taking into account any additional expenses that may have been paid for by employers as well as the time needed to get up to speed.
Consider paid leave, disability compensation, and life insurance when figuring out how to pay for health insurance, advises Espinal. Not to mention, he continues, that independent contractors should try their hardest to “understand the ins and outs of contracts,” which many of them find difficult.
In the end, choosing to begin freelancing full-time may come down to weighing the advantages and disadvantages. For instance, given that the gender wage gap in the industry is still a problem, prospective freelancers might want to think again before leaping. However, independent contractors may also be more selective about the jobs they accept and the companies they work for.
Because of this freedom, many people can avoid working for or with businesses where they have ideological or other disagreements.
Espinal contends that going it alone is becoming popular because, in the end, the advantages typically outweigh the disadvantages. He asserts that the benefits of freelancing include being able to care for your family, working from home, and determining your hours.
He says that if you’re resourceful, quick, and effective, freelancing “may be for you.”
It takes a lot of courage to be a successful freelancer, but if you work hard, persist, and put in the time and effort, you can do it.