Freelancers Are a Force to Be Reckoned With!

Summary: This study surveyed 1,491 freelancers in more than 50 different fields and professions. Below is a summary of the major findings you'll find in this detailed report.

According to a May 2012 Aberdeen Group report, in the U.S. alone nearly 26% of the average organization's total workforce is considered contingent or contract based — and their numbers continue to grow rapidly.

2012 Freelance Industry ReportIn fact, labor law firm Littler Midelson predicts that contingent labor (i.e., freelancers, consultants and independent contractors) could rise to as much as 30% to 50% of the entire U.S. workforce over the next few years. The growth estimates are even higher in many other countries.

Yet despite the meteoric growth in freelancing and self-employment over the past decade, there is very little published information about who we are as freelancers, what we do, how we land work, what we earn ... and why we do what we do.

Politicians and the mainstream media seem to completely overlook this segment of the workforce! When addressing the needs of small businesses, most discussions center on traditional brick-and-mortar operations. Freelancers and other self-employed service providers are ignored, forgotten or dismissed.

It's time to change this trend. That's why we recently commissioned the 2012 Freelance Industry Report (free download; NO registration required).

This study surveyed 1,491 freelancers in more than 50 different fields and professions. Below is a summary of the major findings you'll find in this detailed report which was designed by freelance designer extraordinaire, Katie Kelly. And here's a hand-illustrated infographic we thought you'd enjoy — created by the amazingly talented freelance illustrator David Michael Moore.

  1. Breaking the stereotype. Some interesting demographical information emerged out of this study. For instance, women compose the largest group of freelancers (71%). Furthermore, 34% have 10 or more years of experience freelancing. Forty-seven percent are the primary income earners in their households, and 14% work their business on the side while holding a full-time day job.
  1. Freelancers prefer the independent lifestyle. Forty-six percent of freelancers have more free time now than they did as an employee. Additionally, 90% are happier now than they were before going solo. In fact, 55% said that they wouldn't even consider working as an employee again, regardless of what the job paid or what it entailed.
  1. Finding clients was the biggest challenge facing freelancers today (cited by 21% of participants). Interestingly, obstacles such as getting paid on time (3%) and competing against lower-cost freelancers (3%), which are commonly cited as having reached alarming levels, were not among the top-ranking concerns for freelancers in 2012.
  1. Freelancers earn healthy rates for their work. Although the range varies widely, 49% of freelancers earn between $20 - $59 per hour. Furthermore, 33% earn $70 or more per hour and 15% earn $100 or more per hour.
  1. Women tend to earn more. In fact, women freelancers out-earn their male counterparts in almost every rate level from $20 to $99. It's not until the $100+ per-hour range that men consistently out-earn women.
  1. North American freelancers are NOT the workaholics we think they are. Australians (35%), South Americans (34%) and Europeans (33%) are more likely to work 40 or more hours per week. Only 29% of North American and 25% of Asian freelancers put in those kind of hours.
  1. The economy's impact on freelancers has not been quite as severe as reported. About half (49%) of freelancers either have not been impacted by the economy or have faced only a very minor impact. Only 18% said that they have been significantly affected.
  1. Optimism is also high among freelancers. An overwhelming 77% said that they are optimistic about their business prospects over the next year.
  1. "High-touch" and personal prospecting methods rule. Sixty-eight percent of freelancers named referrals, word of mouth or tapping their own personal and professional networks as their most effective methods for finding and landing clients.
  1. "Accidental" freelancers faring well. Professionals who are freelancing as the result of a layoff or being downsized are more likely to earn less as a freelancer than peers who planned their way to self-employment. However, 85% of these "accidental" freelancers are much happier now than they were as employees. Sixty-six percent of them are also optimistic about their business prospects. And fully 34% of them are earning $70 or more per hour.
  1. Entrepreneurially minded freelancers are happier and earn higher rates. Seventy-two percent of freelancers consider themselves to be entrepreneurs. Thirty-eight percent of them earn $70 or more per hour, as opposed to 20% of nonentrepreneurial freelancers. Twenty-five percent spend 16+ hours per month prospecting (vs. 13% of their peers). And 92% of entrepreneurial freelancers are happier overall since they started freelancing (vs. 86% of their peers).
  1. Freelancers spur economic growth by hiring others. Forty percent of freelancers delegate and/or outsource work to others. Solo professionals do indeed help spur economic activity by hiring other professionals, even if those they hire are independent workers themselves. The idea that a business can impact economic activity only by hiring traditional employees is outdated. Until government leaders understand and accept this, metrics such as unemployment and job growth will fail to gauge the true health of the labor market.

What do you think about these findings? Please share your thoughts or comments in the area below.

Also, feel free share this information with friends and colleagues who may find it useful or interesting. The world needs to know who we truly are ... and what we're about!

  • Okay, this is cool information,

    But the reason I'm commenting is your lack of consistency in units is aggravating! Why would you say "Thirty-eight percent ... as opposed to 20% ..." Maybe I'm OCD or something.

    Is there a reason why you wrote it that way?

    • Hi Darren -- Thanks for checking out the report. The reason for my lack of consistency is that you're not supposed to start a sentence with a numeral. The only instances where I spelled it out were the beginning of sentences. Everywhere else I used numerals and percentage signs.

      Sorry about that. But believe me, my writer and editor colleagues would have complained if I broke that rule! 😉

  • Pamela

    Terrific information-- especially the correlations between the type of self-promotion, the amount of time spent self-promoting and the higher salary.

    Quick question-- you surveyed both writers and copywriters. Can you tell me how you defined writers (as opposed to copywriters)? Thanks.

    • Thanks, Pamela! Glad you liked the report. As far as how we made the distinction, we actually didn't -- we let respondents self-select. The first question in the survey was, "What type of freelancer are you..." and we provided 40+ options from them to choose their primary profession.

      Here's what I think, though: if you selected "writer," you're mainly a general freelance writer or journalist. If you selected "copywriter," you're mainly writing marketing, sales or commercial copy.

  • Great report, Ed. I'm glad to see (trend #9) that high touch and personal prospecting are the methods most widely used by freelancers to find clients -- so I'm right in step.

    • Carol -- Thanks for checking out the report. I was glad to see that as well. This was in line with last year's findings, and it shows that as "un-sexy" as these high-touch methods may be, they're timeless!

  • Great report, Ed!
    I'd love to see more public recognition for us Freelancers.
    How about a report on how most people find their clients? If that is the most problematic part of our business.
    Take care.

    • Hi Mike -- Thanks for your comment and question. There's actually some very detailed analysis on this very issue included in the report. Check out pages 50 - 55.

  • @Ed, interesting statistics, especially the one that cites that intentional freelancers are doing better than "fall-ins", and that in the over $100 per hour group the men out earn women. Would love to see an in depth article on each of these, such as:

    - How to become "intentional" even if you "fell" into freelancing. What makes the two groups different, and what steps can "fall ins" take to be more intentional?
    - How women can overcome the male dominance in the over $100 area. What changes/enhancements to one's CV, portfolio, education, networking, etc. tend to yield the best results?

    Thanks again for some great data!

    • Great ideas, Donna! I can definitely address the first idea myself. And I know a couple of women who would be perfect for addressing the second one.

      Some female colleagues have told me part of the reason this is happening is not that clients aren't willing to pay women higher rates; it's that many women are uncomfortable charging what they're really worth. Whether that's true or not, I'd love to explore this idea further.

      • @Ed Gandia, I agree about not feeling comfortable charging what they're worth. After several years, I'm finally comfortable asking for a reasonable (in line with the competition with equal experience) fee for my services. The sticky point can be with clients I've had for years adjusting to the new fee structure. It's definitely helped having a good proposal structure that is value vs. output based. Sadly I've had some clients who weren't able to see me as other than an employee without benefits, and still thought of me as "one of the girls" in their office, just offsite. But for the ones who have gotten it, the benefits to them and to me have been incredible.

  • Jay

    G'Day all.
    Already Friday here "down under". Just landed 2 more projects before the weekend (thanks to ideas from Ed & Co). September is looking like a great month already. Spring in Australia.

    Thank you Ed and colleagues for putting together this report. Always nice to know how we compare with others; when flying solo.

    The stats on solo business operators in Australia are very similar to USA.


    Is there any chance in the future of finding some way for those of us within the one country being able to make contact via IFA -- A Forum perhaps. It would be interesting to meet like minded people "face-to-face", to discuss marketing strategies which have worked.

    • Fantastic, Jay! Congrats on those project wins!

      Regional forums are not in our plans for next year, but we'll be taking a closer look at 2013 next month, so we'll keep this in mind. It's a great idea, thanks for suggesting it!