Freelancers Multiply as Economy Struggles
BOSTON ( MainStreet) -- Throughout the jobs crisis, as unemployment rates peaked in the double digits, there was one area of growing demand: freelancers. And the ranks of the self-employed are growing.
It's a good-news, bad-news situation, however. For "free agents," working for themselves rather than for a boss, there is more work available. But those opportunities come as cost-cutting companies trim payrolls and turn to part-time and contract workers to trim payroll taxes, reduce health care costs and cut other bottom-line-eroding benefits a full-time workforce requires.
|'Free agents' could eventually outnumber the traditional workforce, one study claims.|
According to estimates by Kelly Services (KELYA) , an outsourcing and staffing firm that provides temporary employment to 550,000 workers annually, roughly 44% of the active workforce last year were freelancers, a 70% spike since 2008.
By the year 2020, research by MBO Partners , a leader in the $250-billion-and-growing independent consulting sector in the U.S., predicts that will be 70 million people -- more than 50% of the private workforce (which includes freelancers, independent contractors and so-called solopreneurs, independent professionals launching businesses-of-one). That shift will begin to "accelerate in 2012 as both individuals and organizations embrace new models of work," it says.
"Freelancing -- once a euphemism for unemployment -- has grown to be a dominant force in the economy, with 42 million independent workers -- more than the total number of autoworkers, teachers, and doctors combined -- driving the U.S. economy," offers a statement issued by the Freelancers Union, a 170,000-member trade organization based in New York City.
Surprisingly, the government, through the Labor Department, hasn't inventoried the independent workforce since 2005, leaving those who track and work with that demographic to offer their own estimates. MBO Partners' Independent Workforce Index , released in September, looked at the state of independent work in America and provided what the firm says is "the first national baseline to help track trends and changes in the independent workforce over time."
In a similar recent study, The New Workforce: Insights into the Free Agency Workstyle , Kelly credits much of the increase in freelancers since 2008 -- more than half -- to terminations, layoffs and "the inability to find work elsewhere," which were cited twice as frequently last year versus 2008 as the primary reason for choosing the life of a freelancer.
But some freelancers choose the lifestyle.
"Job security is being redefined as workers realize that security is now in their own hands," the study says.
The popularity of Web sites such as Craigslist, eBay(EBAY) and Etsy have made working for yourself an option for both new careers and extra pocket money. New technology -- including videoconferencing, social media, email, instant messaging and cloud-based document sharing -- has made the logistics of off-site work less of a hurdle.