Why more than a third of Americans are freelancers
The September jobs report comes out on Friday, with an expected 175,000 jobs to have been added to the US economy. But we already have a snapshot of an area experiencing explosive growth — freelancing.
The number of people who identify as freelancers grew from 53 million in 2014 to 55 million in 2016, which is about 35% of the US workforce, according to a new comprehensive study of 6,000 US working adults conducted by Upwork and the Freelancers Union.
Work: redefined
“The freelance workforce is the fastest-growing component of the economy. Figuring out where it is going is the most pressing question of our digital age,” said Louis Hyman, director of the Institute for Workplace Studies at Cornell’s School of Industrial and Labor Relations.
Some of the fastest-growing freelance positions include content marketers, user experience designers, electrical engineers and writers, among others.
But when it comes to freelancing, how many actually choose to be a part of the so-called gig economy? According to the new study, 63% of freelancers started doing so more by choice than by necessity. That is up 10 percentage points (from 53%) since the survey started in 2014. The majority of freelancers said they feel more secure having a diversified portfolio than having a single employer.
What’s driving changing tastes?
Beyond security, people find plenty of upside in the freelance lifestyle. According to the survey, the top three reasons people said they choose to freelance is to be their own boss, to have work schedule flexibility and to have work location flexibility. Actually, 79% of freelancers said they view their gigs as better than traditional jobs.
Of course, technology makes it possible for many freelancers to work from home or odd hours. Seventy-three percent of freelancers said technological advances have made it easier to find freelance work. And 66% of freelancers said the amount of work they found online increased over the past year, according to the survey. Not only is it easier for freelancers to find gigs, but it has also become easier for prospective clients to quickly connect with workers online.
Additionally, since the implementation of the Affordable Care Act, the self-employed population has insurance options beyond absurdly high premiums or not having health insurance at all. Among other developments, Obamacare introduced new public insurance exchanges and expanded the ways that individuals could be eligible for health care. Now, under the law, individuals who make less than $56,680 or families of four that make $95,400 are eligible for a government subsidy if they don’t have employer-sponsored health insurance.
Still, despite the introduction of Obamacare, 20% of full-time freelancers lack insurance and 34% don’t know where to find information about benefits, said Sara Horowitz, the founder and executive director of Freelancers Union.
“National health reform has been a key support for come freelancers who qualify for subsidies. However, our research shows that freelancers who are working class of moderate means who purchase insurance in the individual market still struggle with affordability and finding benefits that meet their needs,” she said.
Despite the many benefits of the gig economy, freelancers still face difficult hurdles like being paid a fair rate, unpredictable income and a lack of benefits. Because independent contractors are now more than a third of the US workforce, they expect to hear political candidates address the reality and the aforementioned concerns.
According to the study, 85% of freelancers said they are likely to vote — 45% said they would vote for Hillary Clinton and 33% said they’d vote for Donald Trump.
As freelancers continue to gain more market share of the US workforce, so too will their voices. Without a boss to complain to, many self-employed individuals will inevitably expect the government to bear the responsibility of providing benefits and a sustained livelihood.
Melody Hahm is a writer at Yahoo Finance, covering entrepreneurship, technology and real estate. Follow her on Twitter @melodyhahm.
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