The Surprising Benefits of Freelancing in a Turbulent EconomyBy Suzanne Boles December 14th, 2022
In 1995, the job outlook was bleak. My husband had returned to school to upgrade his skills, but there were no jobs for him when he graduated. With the help of a friend, he ultimately launched a delivery business for pharmacies.
I was working in a contract position at the time and, without notice, was given walking papers. That’s when I decided it was time to pursue my dream of becoming a freelance writer.
When the market stabilized, my husband found full-time employment, but I was happy with my freelance writing career. I was tired of working for someone else. As a freelancer, I had so much more freedom. Even if the economy tanked again—and I knew it would—I had confidence I could find clients in need of my talents.
Flash forward to 2022 and, once again, the topsy-turvy economy is giving people heart palpitations about job security. But just as I experienced back in ’95, freelancers may actually have the upper hand when economic uncertainty strikes.
A recent Forbes article noted that 43 percent of business owners plan to hire freelancers to fill talent gaps in their workforce—and 81 percent already use freelancers to support their full-time staff. What’s more, the freelance workforce continues to expand with no signs of slowing down.
Why freelancing can be more stable than a full-time job
For businesses, it makes perfect financial sense to hire freelancers. For one, there’s no overhead for onboarding or desk space. Freelancers tend to be nimble, meaning it’s easier to churn out timely projects. And of course, freelancers don’t get benefits, which represents huge cost savings to companies.
Freelancers may actually have the upper hand when economic uncertainty strikes.
For freelancers, the main perks pertain to flexibility—and the vast number of avenues you can take to find work, from drumming up new clients on Twitter or LinkedIn to getting assignments via word-of-mouth recommendations to finding projects from former employers.
Consequently—and despite the fact that freelancing is often thought of as unstable—there can be a surprising amount of stability in the lifestyle. Freelancers usually have multiple clients, meaning they don’t put all their eggs into one proverbial basket. They are their own bosses. They can choose the type of work they want to do, and pivot as needed.
Compare this to many full-time employment scenarios, and it’s easy to poke holes in the theory that full-time work is inherently more stable. One need look no further than 2022’s slew of tech layoffs—more than 73,000 people in the tech sector had been let go by mid-November—as proof. And for full-timers who do get laid off, finding a new job can be far more challenging.
According to job search advice website Career Sidekick, job seekers can expect it to take three months or more to find a new role after a layoff. When the economy is down, it may take longer. As of December 2022, a number of major tech organizations had implemented indefinite hiring freezes.
When you work for someone else, there’s an intrinsic fear of the pink slip when the economy takes a nosedive, a company goes up for sale, or a business closes its doors. As a freelancer, you might lose a client here and there—but you can often find a replacement relatively easily.
What’s more, freelancers’ client rosters often span the globe, which allows them to build relationships with clients from different geographical locations and industries. This is essentially extra padding in a diversified client portfolio.
The freelance forecast
More than 20 years after I decided to take a leap of faith and start freelancing, I’ve weathered many economic downturns. I’ve seen clients come and go.
When you work for someone else, there’s an intrinsic fear of the pink slip.
Along the journey, I’ve experienced the many benefits of flexibility that freelancing offers firsthand. When my daughter got sick, I didn’t have to call my boss. I simply arranged my schedule around my family’s needs. About a decade ago, I also added teaching part-time writing courses to my repertoire—another income stream that involves work I love.
Today, I’m far from alone in seeing the benefits of the freelance lifestyle. The number of freelancers has increased dramatically since the onset of the COVID-19 pandemic. McKinsey estimates 500 million freelancers will work through platforms before 2030. And statistics compiled by small business fintech Fundera show that freelance workforce growth is three times that of the general U.S. workforce.
All this is not to say that freelancing is recession-proof. In preparation for a possible economic downturn, it’s important for freelancers to conduct an audit of current business operations, income, and expenses, and evaluate options for setting aside savings. If you’re a freelancer looking to allay fears of an economic downswing, there are concrete steps you can take—like exploring a new niche, spinning up a teaching/coaching side hustle, or exploring alternative income streams.
Having lived through multiple economic ups and downs, I’m still confident in my decision to go the freelance route. Choosing to be an independent worker involves its fair share of risk tolerance—but in my opinion, the rewards far outweigh those risks.Image by uzenzen