The Sales Trend 11 of our 12 Sales Trends for 2015 is The Rise of the Freelancer.
Over the past few years there has been a dissonance between two discourses happening at the same time. On the one hand we hear continuously from friends, family, acquaintances and colleagues that the job market is very difficult and more and more people are struggling to find fulfilling work or any kind of work at all. On the other hand, companies and organisations in general say that they can’t find the right talent that they need. How can these two happen at the same time? How can these contradicting views be reconciled? There is a new change of scenery in this landscape that could very well be the solution for both sides of the equation: the rise of the freelancer.
Before we delve into this trend it is worth defining a few terms for the sake of clarity.
We refer to a freelancer when we talk about people who work on their own and have a relationship with the client organisation, they find and get the work themselves as well as handle the invoicing, payments, insurances, etc. In their relationship with clients they usually work on one project (at a time). This category includes people who do this full-time and also moon-lighters—people that have a full or part-time job as employees and freelance on their spare days and/or evenings.
A temp (or temporary employee) works for a staffing company and is hired, managed and paid by said company. The relationship with the client organisation is held by the staffing firm.
There has been a confluence of a number of trends over the past few years that have been changing the talent market landscape and are helping the number the freelancers grow immensely.
The financial crisis in 2007-2008 marked the beginning of the end of the idea of full time employment for many people and organisations, and the same idea (of full time work) became less appealing to others. Around the same time, and for a few decades earlier, the reality of working full-time and raising a family had been a challenge that many parents tackled by avoiding full-time employment and working their own hours instead. Then there was the very important number of people looking for a different lifestyle than the conventional 9-to-5 working hours. So out of these different circumstances many people began choosing to work for themselves as freelancers. This has gotten to a point now where companies need to start considering this group as key when looking for talent. Up until now the biggest ‘consumers’ of freelance work have been other freelancers and either Small or Medium Enterprises (SMEs), but this is changing rapidly. If big organisations don’t want to be left out on benefiting from talent, they will have to start dipping into the freelance talent pool. This is how many talented professionals choose to work now, and the freelance market is full of talent: soloists that run their own business full time; moonlighters, who run their freelance business on the evenings after their day job; and semi-retired professionals who want to keep working and using their skills and experience on a less taxing schedule than the 9-to-5 gig. More than 30% of the workforce in the United States work as freelancers. In Australia the percentage is not too different, with around 3.7 million people working as freelancers.
Over time, this number is only going to get bigger. At present, 1 in 3 Americans are freelancers, and by 2020 the number of freelancers is expected to pass the number of full-time workers. In Australia is still difficult to estimate the growth because of the large number of freelancers that are moonlighting after hours.
The number of freelancers is so big, and freelancers themselves are so important that there are several online marketplaces for freelancers: freelancer.com and Elance are two of the biggest.
What does the rise of the freelancer mean to companies?
Organisations will need to adapt to work with freelancers if they don’t want to miss out on this talent. Until now it has been mostly SMEs working with freelancers, but with the increased number of freelancers, big corporations are now starting to work with them too. In order to ensure that your organisation is not missing out on this talent:
- Consider using blended models of hiring: try to hire all-rounders/generalists as full-time employees and use freelancers for specific knowledge/skills when you need them.
- Reflect on the flexibility of working conditions in the company (working remotely, from home, etc.) and how this can be adapted or improved to fit the freelancer market. This means that your company will have to adopt (if it hasn’t yet) technology to allow for more flexible working conditions (e.g. easy access to mobile networks, Dropbox, etc.)
- Have a working space that allows people to use a desk for a few days when needed and have shared space so when a freelancer is onsite they can easily mingle and get input from the team.
- Learn to work with freelancers. Have people and resources that are allocated to the hiring and management of freelancers. There are several platforms already in the market to help in this area. In big companies, procurement will also have to learn how to deal with this new flexible supplier.
What does it mean for the freelancer?
As a freelancer, the rewards of choosing the projects you want to work on and the place and hours where you want to execute them are many. However, there many things that you need to do to be successful in this space. You need to have a proper invoicing system and be aware of governance protocols, e.g. your taxing obligations and benefits, insurance requirements, etc. You need to know how deal with procurement professionals. Most of all, you need to know where your work will come from. Research shows that 75% of all freelancers state word-of-mouth as their top method of getting work. This figure rose to 84% amongst freelancers earning more than U$ 100,000 per year. Given this, to be a successful freelancer (particularly if you’re new to freelancing), you need to be able to sell yourself, your talents and your work effectively in order to maintain a constant flow of work. You cannot leave it to chance, luck, and “happy clients” to gain work, particularly in such a competitive market.
Fun fact: Freelancer is a word that originated in the middle Ages and meant ‘mercenary’, so a freelancer is a medieval mercenary.
Remember everybody lives by selling something.
 According to Freelancing in America, a research study conducted by the Freelancers Union and Elance-oDesk.
 Research conducted by Elance-oDesk.
 Report by MBO Partners – 2014 State of Independence in America
 Report by MBO Partners – 2014 State of Independence in America