Hiring & Recruiting, Q&A

Upwards Trend in Number of Independent Contractors Not Slowing Down

A recent survey by Upwork called “Freelancing in America: 2018” confirms a trend towards workers moving increasingly into freelance and contract work. Today we are joined by Stephane Kasriel, President and CEO of Upwork, to discuss the results.

HR Daily Advisor: Employers in general and HR professionals specifically are critically aware of the move away from traditional employment towards things like independent contractors, freelancers, and gig workers. Your recent report shows that 1 billion hours per week are done by freelancers in 2018. How big of an impact does that have on the work landscape in the United States?

Stephane Kasriel: This is an enormous impact. It means that 1 in 3 U.S. workers are freelancing. And to put that number of hours in perspective, it’s the same amount of hours that people watch Netflix every week. You can guess which is better for our economy though—productive work or binge-watching TV. The U.S. freelance workforce also grew 3.5 times faster than the nonfreelance workforce since 2014—it’s where the real momentum in our workforce is.

HR Daily Advisor: Your study also shows that freelancers are finding more work online, 22 points   more than in 2014. What kind of pitfalls should HR be aware of with increased online hiring?

Stephane Kasriel: Hiring freelancers online is becoming mainstream, but HR isn’t yet thinking of it as strategically as they should. Rather than for one-off projects, HR would be wise to start considering this way of hiring for longer-term or more complex projects. Any time people are hiring through a staffing firm or agency, they could also consider whether the work could be done with a team of online freelancers. Doing so would allow them to pay the talent more while saving money overall, source people faster (days vs. weeks or months for sourcing using more traditional models), and find that the quality of talent is often better.

HR Daily Advisor: Your study has a stunning finding: 51% of all freelancers say that they wouldn’t do a traditional job for any amount of money. Do you think they really mean it? Can you explain the forces behind such a statement?

Stephane Kasriel: The biggest driver of freelancing is lifestyle—having the freedom and flexibility to live how you want. This is key to having a good life and something that many people do find invaluable. Are there some freelancers who would cave and take a traditional job? Absolutely. But I truly believe a large and growing number of professionals will always choose to freelance no matter how much they are offered. We’re seeing this in today’s economy especially, with its record number of job openings. Clearly people have options, and yet a record amount of freelancing is happening.

HR Daily Advisor: In your study, freelancers showed just how serious they were with 72% willing to cross party lines to vote for candidates who support freelancer interests. Are freelancers more political than your traditional worker?

Stephane Kasriel: What we know from the study is that freelancers are more politically active than traditional workers. Freelancers are a constituency that is a potential political game-changer for candidates, and as freelancers and other entrepreneurs continue to grow their influence—they are increasingly the backbone of growth of small businesses in America—it will be important to reach out to them and build policies that support them.

HR Daily Advisor: According to your study, there was a big difference between freelancers and traditional workers when it came to valuing skills training. Can you explain to what extent and why?

Stephane Kasriel: Freelancers recognize that they must constantly refresh their skills in order to remain marketable, as they frequently need to source new clients. They are therefore more in tune with changing skills and find skills training-  highly valuable. In fact, college-educated freelancers say skills training is more valuable to the current work they’re doing than a college education, with 93% saying training was valuable vs. 79% who said college was valuable. Because freelancers are more proactively updating their skills to remain marketable as the job market evolves, 70% of full-time freelancers participated in skills training in the past 6 months, compared to only 49% of full-time nonfreelancers.

HR Daily Advisor: Should HR be worried that traditional workers who value skills training might be wanting to get into freelancing?

Stephane Kasriel: I don’t think that’s the case. Traditional employees can take it upon themselves to do training just as a freelancer can. But for freelancers, they’re likely more motivated to train more frequently. When you aren’t tied to a single employer, evolving your skill-set with the job market is critical to your ability to get work. Training is not a driver behind choosing to freelance but rather something freelancers find valuable when it comes to supporting the lifestyle they’ve chosen. Freelancers are primarily seeking training to enhance their skills in areas that affect freelancers, including keeping up with changing technologies; building a professional network; and providing business management needed to run the day-to-day of a freelance business.

HR Daily Advisor: Did your study find any difference in stress or anxiety between traditional workers and freelance workers?

Stephane Kasriel: We don’t have direct comparison on these points but did find that:

    • 65% of freelancers (70% of full-time freelancers) say that working as a freelancer has been less stressful than working in a traditional job.
    • 68% of freelancers (79% of full-time freelancers) say they feel happier as a freelancer than they felt in a traditional job.

HR Daily Advisor: Freelancers can’t take advantage of employer-sponsored health benefits. Just how big of an issue is health care to freelancers?

Stephane Kasriel: Health care is the top issue for freelancers in how they will continue to grow their business, with 22% responding that it’s their leading concern. But 66.67% of respondents also say they prefer to make their own choices, like other small business owners, about what benefits can work best for them. In the end, the issues for freelancers mirror those of all professionals—freelancers want access, affordability, and quality in their benefits; and they want to be able to make informed choices.