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Despite Uncertain Income and Benefits, More Workers Are Freelancing by Choice

Despite Uncertain Income and Benefits, More Workers Are Freelancing by Choice
Credit: GaudiLab/Shutterstock

More and more freelancers are choosing to work independently because they want to, not because they have to, new research finds.

The study from Upwork and the Freelancers Union revealed that 63 percent of independent workers started freelancing by choice, as opposed to necessity. That's up 10 percentage points since 2014.

Workers may be choosing to freelance in order to improve their income security, the study found. Having a diversified portfolio of clients makes freelancers feel more secure than having just one employer, the research showed. Specifically, nearly 80 percent of the independent workers surveyed said they view freelancing as better than working a traditional job. In addition, half of those surveyed said they wouldn't go back to a traditional job, no matter how much money they were offered.

Overall, freelancers now represent 35 percent of the total U.S. workforce. The freelance workforce grew to 55 million this year, up 1.3 million from 2015.

"The freelance workforce is the fastest-growing component of the economy," Louis Hyman, an associate professor and director of the Institute for Workplace Studies at Cornell University's School of Industrial and Labor Relations, said in a statement. "Figuring out where it is going is the most pressing question of our digital age."

Freedom and flexibility are driving the growth of freelancing. The full-time freelancers surveyed said the top three reasons they work independently are to be their own bosses, to have flexibility in when they work and to have flexibility in where they work. [See Related Story: 6 Essential Tools for Your Freelance Business ]

Despite 54 percent of respondents making more than they did in their full-time jobs, income predictability is still a concern for freelancers. Struggling to be paid a fair rate, having irregular income and dealing with debt issues were the top three concerns of full-time freelancers.

Health benefits are also an issue for many freelancers. The study shows that 20 percent of full-time freelancers don't have health insurance and 54 percent who purchased it on their own paid more this year than last year.

Knowing that their numbers are growing, freelancers would appreciate political leaders paying more attention to their interests and concerns. Seventy percent of those surveyed said there needs be more discussion of how to empower the independent workforce, a response that is up 7 percentage points from 2015.

"Now's the time for business leaders, policy makers and candidates alike to stand up and take notice of [freelancers] potential influence and to start developing ways to help them overcome the most pressing issues impacting their lives," said Sara Horowitz, the founder and executive director of the Freelancers Union.

Upwork CEO Stephane Kasriel said freelancers want to know that America supports them.

"Independent professionals are an increasingly integral part of the U.S. workforce," Kasriel said. "We should be addressing their interests, or America will fall behind countries that are better equipping their evolving workforces."

The study was based on surveys of 6,002 U.S. working adults. Of those workers, 2,049 were freelancers and 3,953 were nonfreelancers.

Chad Brooks

Chad Brooks is a Chicago-based writer and editor with nearly 20 years in media. A 1998 journalism graduate of Indiana University, Chad began his career with Business News Daily in 2011 as a freelance writer. In 2014, he joined the staff full time as a senior writer. Before Business News Daily, Chad spent nearly a decade as a staff reporter for the Daily Herald in suburban Chicago, covering a wide array of topics including local and state government, crime, the legal system and education. Chad has also worked on the other side of the media industry, promoting small businesses throughout the United States for two years in a public relations role. His first book, How to Start a Home-Based App Development Business, was published in 2014. He lives with his wife and daughter in the Chicago suburbs.