Wrong! 5 Myths of the Freelance Marketplace Debunked

people sitting at a table in coffee shop working
Posted by Michelle Madden in Future of Work on Oct 13th, 2016 15:03 CST

The rise of the independent worker is unprecedented and having a massive impact on the way we work and the way companies get work done.  Companies that may have historically only hired freelancers for more junior assignments, are now getting freelance help in the C-suite with seasoned professionals.

Here are 5  myths of the freelance marketplace debunked and set straight.

Myth #1:  It’s not that big

The freelance market in the US  is comprised of 55 MM people  (up 2MM since 2014), and has grown by over 50% since 2005. In 2016, the freelance market will contribute $1 Trillion dollars to the US economy. The job tenure data supports the evidence of this trend too, just 2 years ago the average number of years in a job was 4.6 years, it is now 4.2 years.

Part of this rise is due to the existence of millennials who are a large part of the work force ( 50% by 2020) and are embracing greater career independence — 38% of millennials are working independently.

Myth #2:  It’s mainly lower wage earners

The industry certainly began with lower wage earners offering services such as driving, cleaning, shopping, errand-running, but it is rapidly moving up the wage curve. The fastest growing segment is actually those people making over $100k a year. There has been a 50% increase in this segment in the past 5 years.

Myth #3:  Workers freelance because they can’t get a “real” job

70% of independent workers say they have selected freelancing by choice. Over half of this group, freelance for supplemental income, while the others are self proclaimed “free agents” who derive all of their income from working independently. 79% of all freelancers say that freelancing is better than working a traditional job.

Myth #4:  Supply is larger than demand

The growth is no doubt being driven in part by workers choosing to be independent, but an equally strong force is companies who are finding greater value in independent workers. “In the next five years, we expect the demand for talent to deliver on new capabilities, to significantly outstrip supply; for agile skills, demand could be four times supply”,  a recent McKinsey article stated.

By 2020, there is expected to be a 40 million shortfall globally of high-skilled workers. As competition grows and the pace of change for companies intensifies, the need for expert, agile talent who can deliver immediate, high-impact results, has never been stronger.

Myth #5:  The matchmaking is happening online

Most hook ups are still happening the old fashioned way. Only 15% of freelancers use digital platforms to find work. For companies like BTG that are built on providing an easy, friction-less experience for talent and companies, this is music to our ears as it suggests that the opportunities for a digital marketplace to serve the needs of the talent and the companies eager to source them, is underdeveloped – and immense.

 

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Michelle Madden

Michelle is Head of Marketing & Communications at BTG. She has worked with Huffington Post, AOL, and Cablevision, helping them build their brands. She is a former Bain consultant and partner at her own media strategy firm where she grew the company and sold it to CommerceOne. She then ran an ecommerce company (GreenYour). She is a passionate foodie and founder of the Webby Award-nominated food blog, The Sweet Beet. Michelle graduated with honors from Queen’s University in Canada, and holds an MBA from Harvard.

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