Freelancing on the rise
The way we work has changed. The traditional 9–5 is no longer a sure thing. More people are freelancing than ever before, with 4.7 Million in the UK now classed as self-employed, enjoying higher rates, flexible hours, and the chance to work from home. Yet freelancing comes with challenges too. With many freelancers concerned with sick pay, health insurance, and saving for retirement. We wanted to take a look at the future of freelancing and how freelancers can leverage their social networks to cover themselves with VouchForMe’s income protection.
What’s driving the growth?
Multiple factors have contributed to the rise of self-employment. Freelancing platforms have removed geographical barriers allowing employers to effectively take on contract staff from anywhere in the world and giving new freelancers an easier way to find work, rather than relying on cold-calling or recommendations. 73% of US freelancers found work through online platforms last year. Additionally, the gig-economy has seen companies like Uber and Deliveroo thrive, with both of these companies relying on self-employed partners to drive their growth.
Unsurprisingly, it’s a young tech-savvy generation that’s driving this change. 47% of Millenials are freelancers, with tech, advertising, and design being some of the most popular careers. Employers see the value too, 39% of business owners believe their demand for freelancers will outpace their demand for permanent employees, as they value the fresh ideas freelancers can bring while also benefitting from the flexibility.
For many freelancers, it’s about the lifestyle, not the job. The top reason given for freelancing in a 2018 study from full-time freelancers, was “to be my own boss.” Other benefits were choosing their own hours, not having to commute, and the opportunity to work on projects they are passionate about. Part-time freelancers, who tended to freelance alongside a permanent job or while at University tend to be motivated more by the prospect of extra wages. While work isn’t always consistent, freelancing can be lucrative, with the average freelancer making £50 per hour, and the top 6% charging over £300 an hour.
While freelancing can seem glamorous, it is not without its problems. While freelancer platforms have allowed people to access jobs all over the world, competition is fierce. One of the biggest platforms, Upwork has over 10,000 freelancers apply each day, with many willing to work for low wages to gain experience, meaning that many users have shunned these platforms for the race-to-the-bottom approach.
The lack of security is a frequent concern for self-employed workers. One in five freelancers is concerned about unpredictable income and saving for retirement. Saving as a freelancer is challenging, with 63% of freelancers dipping into their savings at least once a month, compared to just 20% of full-time employees. When employees need time off, they make use of a holiday day, or if unwell, a sick day. Freelancers don’t have that luxury if they can’t work, they don’t earn. Insurance companies have failed to capitalize on this lucrative new market as income protection insurance has higher premiums for freelancers. That’s why VouchForMe has launched income protection, a peer-to-peer alternative to disability insurance. By leveraging social networks, freelancers can ensure that they’ll still get a regular income, in case of long-term illness or injury.
Freelancing is changing the way we work, by 2027, half of the US workforce will be freelancers, and we want to make sure they can access the same insurance that regular employees get. Click here to see how our income protection works.