The Rise of Freelancing

One of the biggest trends in 2015 was the increasing rise of freelancing. Between on-demand services and the increase of professionals offering their wares independently rather than staying tied down to a job, the big trend in employment was around freelancing. This of course generated important conversations around how we were going to solve the various problems around employment that in the 20th century we shoved off on employers and who was going to make up for that cost in the 21st century. When it comes to injury insurance, sick pay and this sort of thing, freelancers have no safety net outside of their own savings for these problems. It seems unlikely anything will happen when one is young but by middle age an unforeseen medical problem can sideline someone from regular work for months while they recover and the bills pile up. In the past, this wasn’t a pressing problem for most people but now, it is because people rely more and more on themselves. We talked about everything from the end of the 40 hour work week to expanding the government safety to make up for the loss. I’ve enjoyed the discussion about freelancing because I was living and working like this long before it was trendy or cool.

I started offering writing services in 2004 and I used a site called ifreelance who charged a modest fee per month and hand plenty of high paying jobs. Later I moved onto elance, Guru, and Odesk. I remember copywriting in 2004-2013 and how, thanks to overseas competition from Malaysia and India, wages went from $50-$100 minimum to $1-$5 articles. This will only increase as time goes on. When you look around freelancing sites now, there is little work for what I did. If you are in particular niches there is certainly work to be had, but in many of the more popular niches, the freelance market has dried up. In some cases this is with good reason. Blog posts sound way better written by someone inside the company who knows what is going on. Social media has now been absorbed into general marketing and the need for a dedicated social media person really has dried up in the face of having real marketing knowledge.

The trend we’re seeing now has happened before it just happened to a select group of people so few people noticed.
Now that freelancing is more common after the financial crisis, it makes the news.

The reality that Robert Reich talks about was my reality for almost 10 years. I quit doing it because it was already my life. No safety net, trying not to get sick, playing collection agent everyday to get paid and paying a lot of tax for the privilege. The trend I escaped is just reaching the wider economy because our free market has become more efficient and as professionals are now more efficient and use fewer support staff, those who provide services get squeezed. I decided to throw it in. It’s not fun and it’s no way to live. It is hard to plan for anything when you have no idea what is happening with your life financially. If you have credit cards and a money cushion with which you can operate while you wait to get paid then it isn’t so bad but most freelancers I knew didn’t operate with that much capital. We were always checking accounts to see if money had come in.

However, in the future, it looks like most people will be working in that way.

Freelancing is a poor substitute for actual employment the way our society is currently structured.  When you have a consistent income, you can plan, take on debts, and save for the future. When you don’t know how much money you’ll have it creates insecurity and plugs up spending. For people in hot fields like app and web development, programming, and other such fields the attractive hourly rates and such make up for the gap in safety net. Getting a job/clients is fairly straight-forward and easy to do.  However, with this kind of work increasing for people like bookkeepers and accountants and many other service personnel, we have to think about how freelancing works in an on-demand economy where six figure salaries aren’t common or easily achievable. We are forced to again return to the question, “Is this the kind of society that we want to live in?”

Do we want to live in a society that is constrained by what can only be described as unreliable, gig based employment?

Having already lived in that world I can firmly say that if we move in that direction (which we are) then the rest of the economy will be affected. Stable fields like the trades, construction, and other jobs will be reduced as the economy shrinks due to a lack of spending. The spending will occur among the few who can afford and everyone else will be forced to scrape by as they can with what jobs and gigs they can find on sites like Upwork and through apps like Washio, Uber, and others. Finding a pathway to gainful living will be harder, much less a pathway to true success and any kind of financial security. I just don’t think this is the kind of economy that our country can function on or any kind of world that we want to live in. However, there is much we can do to mute the effects of this transition. We can change the way structure the tax code, we can require that any employer that supplies more than 50% of a person’s income be responsible for their sick leave, vacation, and other benefits (Reich’s idea) or we can move that into the government sector (my preferred option) and we can require certain types of industry or employment practices not fall under the independent contractor status. Now is the time to get busy backing labor advocates and other people who are trying to stop the complete breakdown of our economy. I realize that thanks to automation and other factors the 40 hour work week may no longer be necessary or practical. In the early 20th century we moved from 12 hour days 6 days a week to 8 hour days 5-6 days a week. The point is that we need to create a society in which people can live, not one in which people are trying to exist. We can do it, it just takes resolve.