Dino

I wrote the text at the end of this post in 2015.  I thought it was time I updated it, because some things have changed since then – and some things haven’t.

First of all, to be clear, a “gig” refers to any transient or contingent work arrangement, such as freelancing, independent consulting, temporary work, and so on.  It’s not just Uber drivers and Fiverr workers.  Over 200 million people around the world now earn their income this way, either as a side-hustle or as their main source of income.

Research by Mastercard has shown that the digital gig economy (alone) generated $204 billion in gross volume in 2018.  58% was generated by transportation-based services (like Uber).  Gig economy transactions are projected to reach $455 billion by 2023.  At the current rate of growth, more than 50% of the US workforce will be freelancing by 2027.  And the Guardian reports that the gig economy in the UK doubled in size between 2016 and 2019, and now comprises 4.7 million workers.

We’re seeing a huge shift from traditional, full-time employment to freelancing – and this is happening all over the world.

What Has Changed

• Technology has made it even easier to find freelance work
• COVID-19 has forced a lot of people to look elsewhere for their work and income, and many are turning to freelancing

What Has Stayed the Same

• Flexibility is still the main reason for freelancing
• Freelancing is still growing

The main concern for people considering freelancing is still the (perceived) lack of job security.  That was never a strong argument, and with COVID-19, that argument doesn’t stack up at all any more.  In fact, I think it’s easier to find freelance work than a regular job.  According to MBO Partners, more than 50% of full-time freelancers feel more financially secure than those in traditional employment.  Gig economy research by McKinsey shows that 78% of freelancers say they’re happier than those working traditional jobs, while 68% say they’re healthier.  And those who freelance by choice are the most satisfied group within the workforce.

Are You Ready?

If all of that isn’t enough to make you consider freelancing, consider this: if current trends continue, freelancing will just keep growing, and could even overtake traditional jobs.  Are you ready for that?

 

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Think you don’t need to think about freelancing, or your place in the gig economy?  Think again.

In 2015 almost one third of workers in Australia engaged in freelance work, according to this Upwork survey.  That’s 4.1 million people, up from 3.7 million in 2014.  In the U.K. there are 1.4 million freelancers (Professional Contractors Group estimate), up 14% in the past decade.  Another report from Intuit predicts that over the next decade the number of contingent employees will increase worldwide.  In the U.S. alone, contingent workers will exceed 40% of the workforce by 2020.

Importantly, traditional, full-time, full-benefit jobs will be harder to find.  And according to a recent Brookings Institution report, the gig economy is growing at a rate 27% higher than that of full-time jobs.

So unless you’re planning to retire in the very near future, you will almost certainly be affected by the gig economy – whether you like it or not.  The world of work is changing.  Demand for freelancers will continue to increase, with startups and progressive companies embracing the new workforce, so even if you could find a ‘traditional’ job, would you want it?

This represents a major change in the way work is performed – a shift from having a job to working for clients.  You need to be ready for the gig economy.

The most common question I get asked about making the switch to freelance consulting is “how do I manage all the non-consulting stuff?”  And that makes sense, because consultants are used to consulting.  In the freelance world, you need to do more than just consult.  You need to treat your work as a business – doing the things your employer does now.  That means marketing and sales, finding work, accounts (invoicing, cash flow management, taxes), project management, and so on.

That is what I’ll be covering in more detail over the next couple of months – how to manage all the non-consulting stuff, with the least amount of time and effort, so that you can focus on what you do best.

What do you find most challenging when it comes to freelancing?  Let me know in the comments.

 

Cheers
Dino

 

In another post I discuss how to quit the rat race, but before you go ahead and do that, you need to ask the question – “can I work for myself?”

[Read more…] about Can You Work For Yourself?

Ask 100 different people what work/life balance means and you’ll get 100 different answers, ranging from working less, to more holidays, to not working at all.  And they’re all correct, because the definition of work/life balance is like the definition of success – it’s up to the individual.  And it changes over time.  What you consider balanced today may not be the case 20 years from now.

You might be the founder of a growing start-up, with no children, working 80+ hours per week.  And if growing your start-up is your main priority, then that’s fine.  That’s work/life balance for you.

On the other hand, you might be a family man who isn’t looking to grow a business or climb the ladder any further, and spending time with your kids is more important to you.  So you choose to work only 30 hours per week, and that’s work/life balance for you.

I decided back in 2007 that I wanted to work to live, not the other way around.  My kids were 7 and 9 and I wanted to experience them growing up as much as possible, so I became a freelance consultant.  That has allowed me to work on my terms and spend more time with my kids than most working parents get to.

And that’s the beauty of freelance consulting.  You’re in control, and you can decide how much you want to work based on what your definition of work/life balance is.  Sound good but not sure you could do it?  Find out here.

 

Cheers
Dino

 

The case for being an independent consultant

Could you imagine anything worse?  Always worrying about getting your next contract.  Constantly stressed about not having a steady income.  Having to deal with all the ‘business stuff’, like marketing, invoicing, taxes, and so on.  No thanks!

Anyone against (or even afraid of?) freelancing can easily rattle off a long list of cons, like:

• You don’t get paid sick leave or annual leave
• You work on your own most of the time
• You have to work long hours, and be on call all the time
• You constantly have to find clients and work
• You have no job security
• And so on…

The reality is, it’s not all doom and gloom.  IMHO, most of the reasons given are either just plain wrong, or they’re actually positives looked at the wrong way.  For example:

• You don’t get paid sick leave or annual leave
  I couldn’t live the way I wanted to if I was limited to 4 weeks of holiday per year! Especially not as a single parent with kids – they get over 12 weeks off school every year.  Being a freelancer means I can take whatever time off I want.  And even if I’m working, my hours are flexible enough that I can work around my needs.  I’ve been to almost every performance or event for my kids since kindergarten.
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• You work on your own most of the time
  Whether or not this is a problem depends on your personality. As an independent consultant, I spend a most of my time working directly with clients, often at their premises.  But even when I’m working on my own, I use coworking spaces to be around people, and also organise regular coffee and lunch meetings with my network to break up my days.  And one other thing, as a contractor working on 3 to 12 month contracts, I can almost entirely avoid office politics – that’s a huge plus for me.
  .
• You have to work long hours, and be on call all the time
  This is simply not true. I decided when I became a freelancer to not work full time, and that’s what I continue to do.  Even when I get asked to work full time for a new contract, I say that I will work a maximum of 4 days per week, and it’s never been a problem.  As for being on call, as an independent consultant, my clients are all professional businesses and they keep standard business hours.  Sure I’ve had the occasional 6am or 7pm phone call, but they’re rare.
  .
• You constantly have to find clients and work
  True – and that’s fantastic! I love the variety being a freelancer gives me.  I’ve expanded my field of expertise and domain knowledge by taking on varied roles over the years.  And with the right plan and system in place, ensuring you always have work is achievable.  Not to mention that my network is always growing because I keep working with new businesses.
  .
• You have no job security
  This is also true, but you know what? Neither does anybody else!  Think having a permanent job means you’re secure?  Think again.  The only difference is your notice period.  And given that freelancers are used to finding their own work, it gets easier and easier.  Someone with a permanent role who is made redundant (I hate that term) suddenly finds themselves having to figure out how to go about finding work.

 

How Much Do I Really Need?

I also want to point out something that many people don’t seem to get.  Generally speaking, your hourly rate is much higher as a freelancer than as an employee.  So to earn your current employee salary, you only need to work 3 or 4 days per week as a contractor.

Let’s say you’re on a $150K salary.  Assuming you can make $800/day as a contractor, that equates to 188 days per year.  That’s about 38 weeks (roughly a 3 month plus a 6 month contract), meaning you have 14 weeks of flexibility.  That’s 3 months to find your next contract, or to take as leave, or to work more if that’s what you want to do.

The point is, you don’t have to be working every day of the year for 48 weeks – that’s just what we’re used to because that works for employers.

 

So Is It For Me?

At the end of the day, freelancing is not for everyone.  For me, the best thing about freelancing is the freedom and flexibility.  If those are important to you, it might be worth a try.

Not sure if you’re cut out to be a freelancer?  This worksheet can help you decide.

 

Cheers
Dino

 

The freelancing movement is picking up pace – and numbers!

I’ve witnessed this in my personal experience, and I believe it won’t be long before freelancers make up the majority of the workforce.

There are several reasons for the shift, and this article sums them up well.  It also quotes some interesting statistics from the Working Trends 2015 survey.

I’ll cover what I think this shift means in terms of the workplace and work practices of the future in a future post.

 

Cheers
Dino