U.S. Freelance Workforce Growing by a Million a Year

The freelance workforce in the United States has exceeded 55 million people, which represents about 35 percent of the working population, and recent trends show the sector rapidly growing with about a million additions a year.

Some of these workers – accountants and network developers, for example — stand to make more money than in traditional jobs, while others are simply unemployed and forced to take whatever gig they can land. Then there are some who forgo the traditional 9-to-5 routine for a more flexible lifestyle – so-called digital nomads who want to take their work with them around the world.

Freelance website Upwork and the Freelancers Union have commissioned an annual survey on this growing sector for the past three years. The study is conducted by independent research firm Edelman Intelligence, which queries around 6,000 American workers over the age of 18. The annual study showed most recently that the freelance population (which includes full-time and part-time freelancers) has grown from 53 million in 2014 to 55 million in 2016, a 4 percent increase.

The study divides freelancers into a number of categories, including traditional, full-time freelancers; individuals who work full-time jobs and pick up freelancing on the side; temporary contract workers; and freelance business owners.

The survey concluded that 63 percent of respondents started freelancing by choice, not necessity. Of the 55 million, 34.3 million people work as traditional freelancers and what is described as diversified workers (people who work a part-time job and fill out the rest of their schedule with freelance writing and/or driving for Uber, for instance). About 13.5 million are regarded as “moonlighters,” individuals who work full-time and freelance on the side.

Forbes in March compiled a list of fields that have seen significant freelance growth, including designers and developers, content marketers, accountants and tax professionals, writers and journalists, insurance professionals, electrical engineers, personal assistants, tutors, software/application developers and network/security analysts.

Trey Barnette, who manages the Washington, D.C., market for Robert Half and Accountemps, a division of the staffing agency Robert Half, discussed the benefits of project-based work in a recent interview. His team works directly with managers, directors and human resources personnel in placing clients in various accounting, information technology and network development jobs. In a recent poll, the agency found that 42 percent of clients see a benefit in job-hopping or short-term, project-based work.

Barnette said that clients see potential for earning more money and moving quicker up the corporate ladder. On the other hand, employers can save company costs because they don’t have to pay benefits. Companies also value workers with a variety of skills working with different companies in different environments, Barnette said.

“(Freelancers) have the ability to work one project, and then when they move onto the next one, because of the skills they received, they would get a higher compensation,” Barnette said. “If someone’s worked at a Deloitte, EY and a BWC, for them that shows that they’ve worked at three at-large accounting firms in the world, and they should have a higher skillset because of that.”

He estimated that about 30 percent of the agency’s clients prefer project-based work, while 70 percent are actively searching for full-time work. About 60 percent of the company’s placements are for temporary work, he said, while 40 percent land full-time jobs.

Around the same time that Upwork released the results of its latest survey in October 2016, the McKinsey Global Institute released findings from its own survey with 8,000 respondents from the U.S. and Europe. The report showed that 162 million people, or 20 to 30 percent of the working-age population, pick up gig work. The study considered 30 percent of respondents to be traditional freelancers, 40 percent “casual earners,” 14 percent “reluctant” freelancers and 16 percent “financially strapped” into freelance work.

The independent contractors, according to the group, reported greater satisfaction with their work lives than those forced to freelance out of necessity. Traditional freelancers, according to McKinsey, also reported greater levels of satisfaction in various facets of work life than individuals working traditional office jobs.