About Freelancing

The freelancing economy which is commonly known as Gig Economy is a service market which revolves around short terms contracts. Companies or individuals hire self-employed workers to undertake specific jobs in return for an agreed payment, rather than offering them permanent positions. The people offering to do these jobs are called Freelancers. Freelancers find jobs through Staffing Agencies, Classified ads or using different online platforms.

Freelancing is not a new phenomenon, Independent service provider are here for about decades now. But in recent years their number has seen a drastic increase in different fields like Designing, Writing etc. The shift to self-employment can be ascribed to various factors like uncertain economic conditions, demand for more flexible working hours and digitalization as internet has made it much easier for people to work remotely.

According to a study released by Upwork and Freelancer Union, currently in America only there are about 57 million people in Freelance Economy up by 3.7 million since 2014. This represents about one third of American workers. About 51% of people say that no amount of money would ever lure them to take a traditional job. The report also says that Freelancers are doing this independent work by choice, according to a survey 61% said they came into this work by choice. Moreover, in 2014 about 17% freelancers were doing full time freelancing but now the number has increased significantly to 28%. According to Upwork CEO, the fastest growing section of freelancers is those who are making $75000 and more annually. These represent about 31% now previously in 2014 it was 16%.

The freelance market makes up nearly 5% of GDP of US, more than other industries like construction, mining, transportation etc. On average about more than one billion hours Americans spend on freelancing weekly and in 2019 $1 Trillion revenue was generated from freelancing for economy. With freelance workforce being stabilized, the frequency of freelancing growth is increasing. In 2019, about 31% of freelancers were engaged in freelancing on daily basis and about 29% on weekly basis. The reason that why the number of freelancers is increasing because according to 46% freelancing provides flexibility to work which is impossible in traditional job which most people are looking for.

Currently America is leading having highest number of freelancers, followed by India then Ukraine, Pakistan and UK on fifth. On a global level people with age from 18-34 represents 64% of freelancers, and have earned about 53%. While among the age 35-44 represents 23% of freelancers but have a total earning of about 32%. The freelancers above these ages represent 14% and contribute about 15% of total earning. According to Pioneer’s Global Gig Economy Index US topped the world in terms of earnings from freelancing followed by UK, Brazil and Pakistan. While India remains at number 7 in terms of total earnings. The report was based on a sample of the more than 300,000 freelancers in Pioneer’s network.

Freelancers are willing to work as many hours as they want. Some work full time thereby maintaining the jobs for different clients and companies, others do it as a part time just to earn some extra income. They agree on a fee upfront with clients and then send them invoice when work is completed to get paid. Freelancers also have a benefit that they can deduct business earnings from their earnings, thereby reducing the amount of taxable income the pay. They are considered independent contractors, meaning they are responsible for paying their own taxes and health insurance.

Freelance economy has also been affected by societal problems. For example in US freelancers do not receive company health insurance, they also pay hefty self-employment taxes but do not get that much retiring savings benefits. As a result today’s freelancer may not have enough retirement savings for their old age.