Freelancers Are Taking Over the Labor Market

Date: March 15, 2017

As the labor market tightens, more businesses are turning to flexible help.

The staffing process is in the midst of a freelancer makeover. 

One-third of businesses used freelancers in 2016. Of that contingent, 55 percent expect to have more freelancers in 2017, according to a recent Upwork report

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“Businesses are scrambling to adapt and keep up with the rapid pace of change in our world. In just a few years, a third of the skills needed in the workforce will be brand new,” said Upwork CEO Stephane Kasriel. “Traditional models of hiring no longer provide the agility businesses must have to access in-demand skills when and where they’re needed. With 55 million Americans freelancing, businesses are thinking beyond archaic Industrial Era-approaches and turning towards flexible hiring to get work done.” 

Freelancers are coming in handy, especially considering that 41 percent of hiring managers surveyed found hiring had gotten harder in the past year, compared to just 14 percent who said it got easier. NFIB’s research has highlighted the same trend: 52 percent of small business owners said they were hiring or trying to hire, but 44 percent said they found few or no qualified applicants. 

“The post-election optimism we’ve seen among small businesses has led to more job openings,” said NFIB President and CEO Juanita Duggan. “The only thing missing is qualified applicants.”  

The Freelancer Appeal

Forty-eight percent of companies are taking advantage of this market by utilizing freelancers or flexible workers. Businesses stated they mainly hired freelancers to help meet project demands (56 percent) and to find skills not currently available in-house (49 percent). 

And the businesses that are using freelancers are reaping the benefits. Seventy-seven percent of hiring managers said using freelancers has helped their business get more done, and 48 percent said freelancers helped them balance their team to properly meet project workloads. 

Plus, there are plenty of flexible workers to draw from. Currently, more than 34 percent of all employees are freelance workers, with that number expected to rise to nearly half of all workers by 2020, according to Small Business Trends

“Corporate adoption of freelancers is poised to increase,” Barry Asin, president of Staffing Industry Analysts, said in the Upwork report. “Driven by the growing acceptance of freelancing as well as technological advances, companies are integrating freelancers and other contingent workers into their strategic planning as they see the value of new working alternatives in addressing critical business challenges.” 


A Rising Gig in the Economy: Freelancers 

Should I Use a Freelancer or Hire an Employee? 

How (and Why) Your Business Can Tap Into the Freelance Economy

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