Research Summary. As more and more people have adapted to working at home, the number of them adopting freelance work has been growing at unprecedented rates. Even despite the fact that the COVID-19 Pandemic is starting to have less of a hold on the U.S., many Americans who got a taste of freelancing are eager to keep the new lifestyle going.
With that in mind, let’s break down the benefits and challenges of freelancing, along with the trends and predictions related to the future of freelancing in the United States:
70.4 million Americans did freelance work in 2022.
Freelancers contribute $1.3 trillion to the United States’ economy each year.
As of 2022, 36% of the U.S. workforce does freelance work.
The number of freelancers in the United States has increased by almost 33% between 2014 and 2022.
Freelancers earn, on average, $28 an hour for performing skilled services.
Computer programming, marketing, IT, and business consulting are top industries for freelancing, with 50% of freelancers providing such services.
Freelancing is expected to grow by approximately 14% over the next six years.
There are an estimated 1.2 billion freelancers in the world — that’s over 34% of the global workforce.
US Freelancers 2017-2022
|Year||Number of Freelancers|
For further analysis, we broke down the data in the following ways:
The Freelance Industry | Freelancing by Industry | Freelancers | Benefits | Challenges | Trends
General Freelance Statistics
The United States has the largest freelancer market in the world based on year-on-year revenue growth.
In 2019, the United States was ranked as the largest freelance market in the world, with a 78% year-on-year revenue growth. The U.S. was followed by the United Kingdom and Brazil, with year-on-year revenue growth of 59% and 48%, respectively.
The top ten global markets for freelancers also included Pakistan, Ukraine, The Philippines, India, Bangladesh, Russia, and Serbia.
36% of freelancers are full-time, long-term freelancers.
Research suggests that 36% of the freelancing workforce in the United States do so full-time on a long-term basis. Thus, according to the data, approximately 25.3 million people, of the total 70.4 million individuals performing freelance work across the country, are full-time freelance workers.
In 2020, an additional 12% of people in the United States started freelancing for the first time.
The onset of the COVID-19 pandemic in 2020 resulted in an influx of new freelance workers across the nation. Of the 12% of the labor force that started freelancing for the first time during the pandemic, 48% of them already see it as a full-time and long-term career opportunity.
Although the number of new freelancers increased during the pandemic, it should be noted that 10% of existing freelancers stopped working due to COVID shutdowns. Of that 10%, however, 88% of people said they planned to return to freelancing in the future.
Income made by freelance workers represents 5% of the United States’ gross domestic product or total market value.
Contributing more than $1 trillion to the U.S. economy on a yearly basis, freelance work adds more money to the nation’s economy than the construction and transportation industries.
The Freelancing Industry Statistics
In terms of total market value, Freelancer, Upwork, and Fiverr are the top freelancing websites.
Freelancer, Upwork, and Fiverr are all valued at hundreds of billions of dollars and generate several billion in revenue each year.
According to research on online freelancing platforms, Fiverr estimates that their total addressable market is $115 billion, Upwork estimates that their total addressable market is $560 billion, and Freelancer estimates that their total addressable market is $5 trillion.
However, it should be noted that the higher value released by Freelancer could be indicative of estimation difficulty.
Upwork has seven million registered freelancers.
Upwork, which is considered one of the largest online freelance marketplaces globally, has about seven million registered freelancers and 12 million registered clients. At any given time, the platform has approximately 100,000 jobs available across a wide range of skills.
For comparison, Freelancer.com, another leading international freelance platform, has 30 million registered freelancers. However, it should be noted that freelancers on Upwork must be approved, whereas Freelancers on Freelancer.com do not need any pre-approval to open an account.
32% of freelancers in the United States are independent contractors.
36% of freelancers are diversified workers — or people with multiple sources of income from a mix of traditional and freelance work — 32% of freelancers are independent contractors, 21% of freelancers are moonlighters, 6% of freelancers are freelance business owners, and 5% of freelancers are temporary workers.
The majority of freelance workers earn the same or more money than they did when employed at a traditional job.
A 2020 survey of 6,000 U.S. workers over the age of 18 found that 75% of freelance workers earn the same or more money than they did when employed at a traditional job. The report concluded that freelancers contribute $1.3 trillion to the United States’ economy in yearly earnings.
Freelancing by Industry Statistics
82% of freelancers in the United States are freelance writers.
Writing seems to be a popular gig for freelance workers in the United States. According to findings from a survey of 643 freelancers, 82% of U.S. freelancers are writers and, of that, 24% earn more than $50,000 a year for their freelance writing services.
The majority of employees working in creative fields are freelancers.
75% of employees in the arts and design industry and 55% of employees in the entertainment industry are freelance workers.
As a whole, creative industries have more freelance workers than non-creative ones. For instance, freelancers only account for 21% of employees in the manufacturing and production industry and 25% of workers in the administrative support industry.
More than 30% of Fortune 500 companies use freelancers on Upwork.
From project-based assignments to longer-term contracts, a sizeable (and growing) number of major international companies are turning to the popular freelance platform.
Up to 70% of small businesses use freelancers.
It’s not just the big names that use freelancers — in fact, small businesses stand the most to gain from the low overhead that freelance work offers. Half of small businesses have used a freelancer in the past three months, and 81% plan to use freelancers again or at some point in the future.
Demand for freelancers surged during the global COVID-19 pandemic
As traditional offices closed their doors and were forced to furlough employees, the freelance market in the United States saw seizable revenue increases. Monthly revenues made by freelancers in the U.S. increased by 11% between April and May of 2020 and jumped an additional 18% in June 2020.
Skilled services are the most common freelance jobs.
Skilled services, including computer programming, marketing, IT, and business consulting, are the most common types of jobs performed by successful freelancers. In 2020, 50% of freelancers in the United States provided skilled services, up from 45% in 2019.
The Life of a Freelancer Statistics
Skilled service freelancers earn, on average, 70% more than traditional workers in the United States.
With an average median rate of $28 an hour, skilled service freelancers make 70% more money than average traditional workers across the nation. All other freelancers have an average hourly rate of $20, $1.20 more than the overall average median hourly rate for workers in the U.S.
Freelancers spend between zero and over seven hours a week looking for work, depending on their industry and skill set.
According to research, freelancers working in the IT and programming industry spend the least amount of time looking for work, with 54% of them spending just two hours a week looking for work.
On the other hand, freelancers in the legal industry spend the most amount of time looking for work, with 40% of them spending between three and six hours a week looking for work and 33% spending more than seven hours a week looking for work.
The data also illustrated that 41% of writing and translation and administrative and customer support freelancers, 39% of engineering and manufacturing freelancers, and 36% of sales and marketing freelancers spent two hours a week or less looking for work.
46% of freelancers who worked during the COVID-19 pandemic found work through a previous client or family and friends.
Almost half of the freelancers in the U.S. who worked through the COVID-19 pandemic found work through their personal and professional connections.
In addition, 42% of freelancers also used social media to find new clients and work. Other top methods freelancers used to find work included online advertisements, freelance websites, online job boards, previous employers, local newspapers, and staffing firms.
The majority of freelance workers have had multiple clients in the past six months.
According to a report released by Upwork, 58% of freelance workers in the United States have had more than five clients in the past six months. That number is up by three percentage points from 2019, supporting the statistic that 65% of freelancers reported increased hours since the pandemic hit in 2020.
More than half of U.S. freelancers think that having multiple clients increases their job security.
63% of freelance workers agree that having a wide and diverse portfolio of clients is more secure than having only one client. Freelancers across the country serve, on average, 4.5 clients each month, or 27 clients in a six-month period.
36% of freelancers in the United States make more than $75,000 a year.
Freelance workers are making more money now than ever before.
A recent analysis of freelance workers in the U.S. found that 19% of freelancers earn $75,000 to $99,999 per year, up from 9% in 2014, 12% of freelancers earn $100,000 to $149,000 per year, up from 5% in 2014, and 5% of freelancers earn $150,000 or more per year, up from 3% in 2014.
Statistics on the Benefits of Freelancing
60% of freelancers started freelancing by choice.
According to a 2019 study conducted by Edelman Intelligence, 60% of freelancers in the United States reported starting freelancing by choice. That number is up by 7% from 2014 when just 53% of Americans said they started freelancing by choice.
Having the flexibility to raise and care for family members is one of the top reasons people choose to freelance.
In 2020, 48% of freelancers were caregivers. Of that 48%, every two out of three people said that freelancing had provided them with a way to support their family outside of the constraints of a traditional job. In addition, more than 66% of non-freelancers said that they would consider freelance work in order to care for a family member.
Professional development training is one of the best ways to earn more money as a freelancer.
The majority of freelance workers in the United States report that professional development training increases profitability.
A recent study found that freelancers invest in their own training and education more often than non-freelancers, with 65% of skilled freelancers completing business-related training in the past six months compared to just 40% of non-freelancers.
More than 50% of freelancers would not take a traditional job again.
Of the nearly 20 million people who started freelancing in 2020, 60% of them said that there is no amount of money that would convince them to go back to working at a traditional job again.
The average annual salary for freelance writers in the United States is $63,488.
According to research conducted by ZipRecruiter, freelance writers in the U.S. earned, on average, $63,488 annually in 2019. When broken down, the yearly salary equates to about $31 an hour, a $10, or 49%, increase from 2015, when freelance writers earned about $21 hourly.
Statistics on the Challenges of Freelancing
Most freelancers in America think that politicians are ignoring the needs of freelance workers.
Barred from participating in critical programs like unemployment, the majority of freelance workers report that politicians are minimizing or ignoring their needs so much so that 56% of freelancers said they would be more likely to vote for a candidate that supports their career interests, and 72% said that they would be open to crossing party lines if a political candidate publicly supported freelancers.
More than half of all freelance workers in the United States have difficulty saving money.
According to a survey of freelance workers across the nation, 71% of freelancers found it hard to save because of unpredictable income, and 41% of freelancers found it hard to save because of short-term emergencies and high housing costs.
Freelancers also ran into financial troubles related to short-term financial needs, high healthcare, and health insurance costs, and high taxes.
17% of freelancers do not have health insurance.
Although 83% of freelance workers in the United States do have access to health insurance, it doesn’t come easy for the majority of them. Of full-time freelancers with health insurance, 24% purchase insurance themselves, 21% get insurance through Medicaid, 19% get insurance through Medicare, 15% get insurance through a spouse’s plan, and 7% get insurance through a parent’s plan.
Additionally, 47% of freelancers who purchase health insurance themselves said they paid more in health insurance premiums in 2019 compared to previous years.
Freelance workers have a greater likelihood of living paycheck to paycheck.
Freelancers historically face more cash flow challenges than non-freelancers and traditional employees. A recent survey found that 59% of freelancers in the U.S. work paycheck to paycheck, compared to 53% of non-freelancers.
Freelancers typically have to wait 30 days or more for payment, which is a primary reason for their increased cash flow challenges.
The majority of freelance workers have to use their personal money every month for business-related expenses.
A 2017 study found that 63% of freelancers have to use their personal savings at least once a month to smooth over gaps. This is compared to just 20% of traditional, non-freelance workers.
44% of freelancers have been ripped off at least once.
In a recent survey by Fiverr, 44% of freelancers said that clients didn’t pay them for services rendered at least once during their career as freelance workers. Moreover, half of all freelancers who have been ripped off think that the reason is that companies don’t take freelancers seriously.
55% of freelance workers in America are concerned about the impact of automation.
More than half of all freelance workers across the nation are worried about how automation — a term used to describe an increase in automatic procedures and a decrease in human input — will affect their livelihood. Meanwhile, only 29% of non-freelancers have the same concern.
Freelancing Trends and Predictions
The majority of traditional employees who work remotely are now considering freelance work.
According to Upwork, 73% of non-freelance remote workers are considering freelancing in the future because working remotely made them more productive employees.
In the same survey, 74% of remote workers said that they wanted to start freelancing because they prefer working remotely instead of returning to a traditional office, and 85% of remote workers were considering freelancing as a way of earning extra cash to make up for lost income as a result of the pandemic.
More than half of the United States’ population will be freelancing in six years.
As the U.S. workforce grows, so does the number of freelancers. According to projections from the 2017 Freelancing in American Survey, 50.9% of the U.S. population will be performing freelance work by 2027 if the current growth rate of freelancers continues across the nation.
Between 2014 and 2020, the number of freelance workers in the United States has grown by 32.83%.
The number of individuals doing freelance work in the United States has been steadily increasing since 2014. There were approximately 70.4 million Americans freelancing in 2022 compared to just 53 million in 2014.
The addition of 17 million freelance workers over the six-year span represents a growth rate of 32.83%.
Over the next decade, work performed by freelancers is expected to increase by 168%.
Hiring managers across the nation expect the volume of work performed by flexible talent, which includes freelance workers and temporary employees, to increase by 168% over the next ten years.
The expected increase in the use of freelance workers by companies across the country is likely linked to cost and simplicity. In a survey, 27% of hiring managers said that their primary reason for using freelancers was cost efficiency, while 24% reported that their primary reason for using freelancers was that it made it easier to find talent.
Half of all individuals aged 18 to 22 years old have performed freelance work.
According to a survey conducted by Statista, 50% of people who belong to Generation Z, which includes individuals aged 18 to 22 years old, have participated in freelance work.
Millennials, or people aged 23 to 38, represent the next biggest group of individuals saying yes to freelance work, with 44% reporting participating in freelance work.
The data suggests that older generations are less likely to perform freelance work, with 30% of people in Generation X, who range in age from 39 to 54, and 26% of Baby Boomers, or those over 55 years of age, reporting having participated in freelance work.
86% of freelancers in the United States say that the future of freelancing is bright, with the best days still to come.
In Upwork’s Freelance Forward report, the overwhelming majority of freelancers had positive attitudes concerning the future of their livelihoods.
In addition to the 86% of freelancers who reported that the best days are still ahead for freelancing, 71% of surveyed freelance workers said that perceptions of freelancing as a career are changing and becoming more positive.
What is freelancing?
Freelancing refers to any work completed by an individual acting as an independent company. As such, freelance workers are self-employed individuals who are hired by companies on a short-term basis to perform a service or complete a task for a specified amount of money.
Unlike traditional employees, freelancers are not tied to any company and therefore do not receive the same compensation or benefits as full-time employees.
Where does the term freelance come from?
The term freelance comes from the British Empire in the early 1800s. More specifically, the term freelance dates back to 1819 when Sir Walter Scott referred to soldiers who worked for payment, rather than loyalty to a particular party of the king, as “free lances” in his book Ivanhoe. Earlier references to the word were also seen in texts from 1716 and 1809. However, there is little knowledge of those publications.
In the early years, “free lance” was also used to refer to independent politicians, and it became a common term used to refer to writers in the 1930s. Written evidence suggests that the word “free lance” was primarily used in the early 1800s before it was hyphenated to “free-lance” in the 1920s. By the 1970s, the hyphen was dropped, and the modern word “freelance” emerged.
What is a contract worker?
A contract worker is someone who enters into a contractual agreement with a business whereby they’ll provide a service for a fee. For this reason, freelance workers can often be referred to as independent contractors or contract workers. In the United States, many freelancers are contract workers in that they perform work as part of a short-term contract or agreement with a company.
Overall, contract workers perform work for a specified fee outlined in a contractual agreement executed by both the freelancer and the business or receiving party.
An independent contractor, also commonly referred to as a 1099 employee, is the IRS’ classification of a contract worker or freelancer.
What percentage of freelancers are successful?
The majority of freelancers are successful, with 64% saying their health has improved as the result of their work. 36% of US-based, full-time freelancers make over $75,000 a year. Considering that about 15% of Americans (individuals, not households) earn over $75,000 a year, freelancers actually tend to be more successful than traditional workers.
Additionally, 84% of full-time freelancers self-report that they’re satisfied with their current position. That’s roughly the same as the US workforce, where 85% of workers claim to happy with their job.
Regardless of your definition of “success,” freelancers seem to have found it at equal or greater rates than regular full-time employees.
Are freelancers self-employed?
Yes, freelancers are considered self-employed by the IRS. That means freelancers must pay the self-employment tax rate of 15.3%, which essentially covers both employer and employee taxes.
On the plus side, self-employed individuals are more likely to have greater deductions, since a person who works full-time from home can write off a lot of their basic expenses as business expenses (electricity, internet, office supplies, software, etc.).
Do I need an LLC to freelance?
No, you do not need an LLC to freelance. However, making an LLC as a freelancer can come with certain benefits. For one, it helps separate your business and personal finances, which makes tax season way more straightforward. Plus, people in some industries will feel more comfortable dealing with someone with an LLC than an individual.
While not every freelancer will see a major benefit from creating an LLC, it’s worth looking into if you plan to make freelancing your full-time occupation.
If you’re looking for flexibility, an opportunity to make a lucrative salary, and a chance to develop and succeed in your chosen industry, freelancing might just be the best career move you can make.
The number of freelancers has increased rapidly in recent years, and the industry has no sign of slowing down. With 58 million people across the United States regularly performing freelance work, contributing an impressive $1.3 trillion to the U.S. economy on a yearly basis, perceptions of freelancing are changing for the better, and profitability is increasing.
Today, most freelancers earn, on average, at least $1.20 more than traditional workers, and researchers anticipate that number will only increase as the industry grows by 14% over the next six years. With more than half of the U.S. population expected to be freelancing by 2027, the future of freelance work looks bright.
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