57% of freelancers are satisfied with the amount of money they make for the amount of work they do, compared to 42% of non-freelancers.
60 million Americans now freelance full or part-time, equal to 39% of the U.S. workforce. Nearly three quarters of those say their perceptions of freelancing as a career are becoming more positive, up from 68% in 2021.
51% of all freelancers provide knowledge services such as computer programming, marketing, IT, and business consulting. 26% of all U.S. freelancers hold a postgraduate degree, up from 20% in 2021.
From spring 2016 to summer 2017, I worked as a full-time freelancer in Brooklyn. The freedom was exhilarating; the pay not so much. After a year of turning down near every social activity that cost money, I had a choice: stay in New York and get a better-paying desk job, or take the full-time freelancing elsewhere.
I took the desk job.
Flash forward to 2022, and prospects for freelancers are far more exciting now. The unprecedented shift to remote and hybrid work caused by the pandemic has transformed how people view their job and ideal work-life balance. In light of macro themes like “The Great Resignation” and “Quiet Quitting”, more employees than ever are now questioning traditional full-time employment and reassessing what it means to have a fulfilling career.
Upwork's latest Freelance Forward survey, conducted amongst 3,000 U.S. professionals, studied the present and future of freelancing. It found that an impressive 39% of the U.S. workforce—or 60 million Americans—performed freelance work in the past year, an all-time high since tracking began in 2014. At a time of economic and labor market uncertainty, American freelancers contributed approximately $1.35 trillion in annual earnings to the U.S. economy.
It’s clear that an ever-increasing number of U.S. workers are turning to either full-time or part-time freelance opportunities. The question is why. How is this path helping them find greater financial stability and professional fulfillment?
More opportunities = greater optimism
It’s commonplace to assume a full-time job is the most stable career path. But according to Upwork’s data, it’s actually freelancers that prove slightly more optimistic in the face of an economic downturn.
This can be explained in part by an increase in the perceived volume of freelance opportunities. Seventy-six percent of those surveyed said there are now more opportunities compared to pre-pandemic times, compared to just 57% of respondents last year. As a result, 77% of freelancers feel optimistic about their personal income and salary for the coming year, and 80% are optimistic about future job opportunities.
Despite the fact that 75% of all professionals said they’re concerned about worsening economic conditions, 69% of freelancers expect their income to increase in the coming year. I found this case of optimism particularly surprising, as one would expect freelance budgets to drop across industries as companies aim to cut costs.
But 68% of the freelancers surveyed have more than one employer, job, or contract project. With this diversity of income, there is less reliance on a single employer’s performance, a factor that certainly matters more for those with a full-time job during economic uncertainty.
McKinsey echoed these sentiments in the latest iteration of its American Opportunity Survey. “In our spring survey of 25,062 Americans,” the firm stated, “the 5,280 respondents who identify themselves as independent workers reveal a distinctive characteristic: They are far more optimistic, both about their own futures and the outlook for the economy, than the average American worker.”
Freelancer pay continues to grow
While optimism over earning potential is one thing, Upwork’s study shows that a majority (61%) of freelancers say they make as much as or more than they would from traditional full-time employment.
This coincides with an increase in highly skilled and educated professionals among the freelance workforce. Over half (51%) of all freelancers provide knowledge services such as computer programming, marketing, IT, and business consulting. Twenty-six percent now hold a postgraduate degree, up from 20% of freelancers in 2021.
Another factor here is that freelancers have more autonomy to determine their pay. Forty-three percent of freelancers say they raised their rates during the past year. The ability to raise their rates is likely why 57% of freelancers are satisfied with the amount of money they make for the amount of work they do, compared to 42% of non-freelancers.
More opportunities + optimism + money = greater satisfaction, both in and out of work
In 2016, I felt like I had one of the three. But as we enter 2023, the booming state of the freelance industry sees satisfaction levels continue to rise. Sixty-six percent of freelancers say they feel more stimulated and 68% say they feel happier by the freelance work they do compared to a traditional job.
Other benefits include more headspace to devote to physical health, mental health, and overall well-being. These benefits spill over into everyday life, where 71% of freelancers feel it provides an alternative to better support their families and 64% believe freelancing allows them to have stronger personal relationships.
Don’t expect the rise in freelancing to fall any time soon. Younger generations entering the workforce are embracing the path en masse.
In 2022, 43% of Gen-Z and 46% of Millennial professionals freelanced, compared to 35% of Gen-X and 27% of Boomers. A big reason is the increase in influencer content creation and marketing, fields popular with Gen-Z and Millennials that rely on the freelance economy.
As these younger generations get closer to professional maturity, it’ll be interesting to see if freelancing overtakes FTE as the dominant form of work. Whether or not that happens, acknowledging the possibility already feels like a milestone.