It's no secret that the Gig economy is on the rise. More and more people are turning to freelance work as a way to enhance their income in an uncertain economy and gain more control over their work-life balance. The latest data from Fiverr confirms this trend.
According to a recent survey conducted by Fiverr in partnership with Censuswide, 73% of US workers plan to freelance in 2023. This is a significant increase from previous years, and it's clear that freelancing is becoming a more mainstream way of working. But it's not just individuals who are turning to freelancers, companies are also increasingly turning to skilled freelance professionals to fill key roles and functions.
This trend is also reflected in other studies, such as “Upwork's 2022 Freelance Forward”, which we talked about in our blog post “Gig Economy on the Rise - Freelance Work Grows to 39% in the US - Upwork Report”, and states that 39% of the United States workforce is already part of the Gig economy, as we speak.
Upwork’s research repeats a 73% result for a similar question - this time the respondent professionals said that freelancing perceptions are getting more positive in 2022 - that's up from 68% in 2021. This study also projects that by 2028, more than half of the US workforce will be freelancers.
As reported by Human Resource Executive in their article "A ‘tectonic’ shift is boosting freelance work. What should HR know?" many companies continue to face a persistent talent shortage and navigate economic uncertainty. In a recent survey of 1,000 US business leaders by ResumeBuilder.com, nearly 60% of the respondents have laid off employees in the last three months and more than half plan to conduct layoffs in the first half of 2023.
Of the companies that had recent layoffs, nearly 40% plan to hire contract workers to replace the talent that was let go. And more than half have asked some full-time employees to transition to contract work.
This pull towards freelance and contract workers is a part of the latest HR trend: "Quiet Hiring," or the strategy by which organizations acquire new skills and capabilities without acquiring new full-time people, according to Gartner’s senior director Emily Rose McRae: "This approach can help keep payroll costs low, assist with retention and cultivate home-grown skills".
One of the main reasons for this increase in freelancing among US citizens is the rising costs of living, but not only this. Another reason is the need for a flexible work-life balance.
With the option to work remotely, freelancing allows people to have more control over their schedule and work around other commitments such as family and personal life.
The Fiverr survey also revealed that 53% of the US worker respondents are feeling less secure about their income this year compared to last year.
This is a worrying trend and highlights the need for people to find ways to enhance their income and protect themselves from an uncertain economy. But as we can see, companies are also turning to contract workers as a solution to economic uncertainty and talent shortage.
Despite all the challenges, not everything should be seen as bad news. The survey also found that increasing take-home pay is on the minds of US workers. Besides the 73% of respondents saying they will start freelancing in 2023, 66% of them said they will join or continue to work on a freelance platform.
Both Fiverr's and Upwork’s survey studies show that freelancing is becoming more and more popular among US workers. Companies are also turning to contract workers as a solution to economic uncertainty and talent shortage.
As a result, hiring managers should keep an eye on this growing trend and pool of talent, and consider integrating freelancers into their full-time workforces. It's a win-win situation for both the employer and the employee.