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Fiona Laughton
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By 2027, the US workforce will be made up of 50% freelancers. In Germany alone, there are over 5 million registered freelancers, which is an increase of 37% in the last 20 years and a number that is rising annually by 1.6%.
With the recent covid-19 virus pandemic causing disruption on a global level (the true economic impact of which is much too early to understand), millions of people have already lost their regular employment and many are left without a safety net. Will this mean more people turn to freelancing? We can only speculate. One thing is certain: traditional work has changed and continues to do so.
That traditional work should change isn’t something new or radical. Throughout history, work has always undergone profound changes due to technological advancements, demographic shifts, and labour market fluctuations. At this moment in time, there are now more registered freelancers than ever.
We’ll look at some of the drivers and key factors behind this traditional work change as well as the tools that are available to employers that make managing freelance staff even easier.
New technologies, such as automation, AI, and digital platforms, continue to drive the future of work, for better or worse. On the one hand, automation and AI offers increased productivity and efficiency, but it has also caused the market great anxiety about the broader impact these technologies are having on traditional jobs, their corresponding wages, and skillsets that are changing so quickly that they’re becoming outdated as soon as workers enter the workforce. Artificial Intelligence will replace jobs, but according to a recent study by Upwork, AI is also the second-fastest-growing-in-demand skill and many companies are either strategizing or are implementing AI technologies throughout their organization.
In Germany, there has been a record annual increase of freelancers, with female freelancers growing at an average rate of almost 4% since 2000. However, just under one-third of freelancers (31.6%) are female.
According to data provided by Upwork, 51% of all freelancers are freelancers by choice. With no plans soon to return to a regular paycheck and 9-5 lifestyle, freelancers cite freedom and flexibility as the biggest perks of freelancing. Whether freelancing on the side of a more permanent job, or alongside passion projects, or around parenting small children, it’s no wonder that many freelancers - particularly, female freelancers - value flexibility as one of the most important selling points.
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When it comes to freelancers, the talent pool has the power to choose the clients they want to work for and the projects they want to work on. They can determine their own rates, availability, and hours, as well as when they can take vacation or pursue professional development. There are no HR departments to deal with or morale-boosting team events to be organized. Those who are highly and/or diversely skilled get to call the shots. This is supported by the sheer amount of platforms there are to connect freelancers to their next project, without need for lengthy application and onboarding processes.
71% of freelancers earn their income online so it’s no wonder that platforms are tapping into this market. Talent-as-a-Service platform Topcoder allows companies to access a diversified pool of developers, data scientists, and designers, and companies can build a workforce that is both on-demand and scalable as project needs change. From the freelancing side, the freelancer can opt-in for a set amount of hours, whilst still remaining free to work on other client projects. On freelancing platform Upwork, freelancers can bid for different projects, by connecting directly with potential clients.
Here at Lano, we’ve built a cloud-based platform that allows companies to connect with their freelancers, by organizing their onboarding, contract management, and invoice payments. For freelancers, this means a smoother collaboration with their clients and payment on-demand. With the right technical tools on hand, freelancers are well supported to adapt to the world away from traditional work.
These days, it’s the exception, not the norm to stay in the same company for your entire career. With the average worker doing ten different jobs before they turn 40, the market is already opening itself up to more freelance work.
Previous negative traits such as a lack of loyalty, consistency and being at the mercy of market needs and economic shifts have seen freelancers build resilience, diversify skillsets, approach work flexibility and have the means and the technological support to get up to speed fast, giving them the efficiency and productivity edge.
How does your company engage with freelancers and do you have the tools in place to manage this?
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