With the emergence of the gig economy, freelancing has never been hotter. In fact, it's estimated that freelancers will comprise roughly 40 percent of the American workforce by 2020. Financial services company Payoneer surveyed 21,000 freelancers from 170 countries around the globe to see exactly what freelancers are going through.
It's worthwhile to read the full 2018 Payoneer Freelancer Income Survey. This, however, is a summary of the highlights.
- The worldwide average hourly rate for freelancers is $19. But rates range from $11 to $28, depending on the industry. Administrative and customer support specialists earn the least, while those in legal services make the most. More than half of freelancers charge under $15 an hour.
- Older freelancers make more money than younger freelancers do.
- While the overall income satisfaction of freelancers is right in the middle on a scale of 1-10 (5.03), high income doesn't necessarily translate to high income satisfaction and vice versa. For example, legal services professionals, who make the most buck, rank third for satisfaction at 5.09. IT and programming professionals, by comparison, rank first at 5.42. Engineering and manufacturing professionals are the least satisfied with their income at 4.83, even though their hourly average rate is $21 just like IT and programmers get.
- The thing freelancers want to improve most (68 percent) is the amount of money they make. But freelancers also want more methods for finding clients and work (52 percent) and to work with more international clients (34 percent). Simplification of payment processes and communication are the least worrisome for freelancers.
- 4 out of 5 freelancers focus on 1 to 3 projects at once.
- About half of freelancers work 30 to 50 hours a week. 22 percent work 20 hours or less, while 10 percent work 60+ hours. Finance, management and HR professionals work the most hours per week (averaging 39), while legal services professionals work the fewest (averaging 33.6).
- The majority of freelancers are located in Europe (35.5 percent), Asia (28 percent) and Latin America (29.2 percent). Africa holds 10.1 percent. And North America has the fewest number of freelancers of all at just 4.1 percent.
- Overall, 3 out of 4 freelancers (77 percent) are men. But gender distribution varies by region. In North America, for example, it's relatively equal. In Asia, by comparison only 1 out of 5 freelancers is female.
- Globally, over 50 percent of survey respondents are under age 30, with just 6 percent of freelancers being over age 50. In the United States, however, about a third of freelancers are at least 50 years old.
Deeper insights about the new data
Scott Galit, Payoneer's CEO, asserts that age and geography probably aren't the only factors at play regarding income satisfaction, and that happiness is likely more situational on a person-by-person basis. Someone trained to work online in South Asia where jobs aren't as plentiful, he points out, probably would be more satisfied than a near-retiree in America who just lost his job and uses freelancing to keep his income up.
The desire to improve efficiency and find more people to work with is probably somewhat situational, too. But most freelancers likely just want to smooth out kinks because they know they can make more money if they do. Freelancers similarly look to up sales across borders because working globally translates to more opportunities than individuals could get locally and, subsequently, more pay.
Galit says that the geographical distribution of freelancers shows that there are certain areas of the world where the tech-driven, service provider economy has become incredibly important. Outsourcing is common in these regions and the focus is on selling internationally. Other regions, like the United States, are big buyer markets where freelancers are more likely to sell locally.
Regarding gender, Galit acknowledges that, in many developing markets, diversity won't meet what people see in the United States. But this doesn't necessarily mean women shouldn't try.
"There is a common stereotype these days of men being more technically educated than women," Galit explains. "But we see a tremendous amount of activity, as well as opportunity, for women. If we look at these numbers ten or twenty years ago, the percentage of women who are in technical roles continues to grow. The financial opportunity is significant and all indications are that there is tremendous opportunity for women to succeed in this area and earn attractive incomes in the process.
And while freelancers are young as a rule, Galit points out that millennials and other adults just starting out can have vastly different goals based on the maturity of their market.
"For [young people in developing economies], freelancing is a way to earn more income than what they could in their local market, and it creates a significant opportunity for them to get an education, where the focus is usually on technology. As a result, they become much more marketable and their income and earning potential becomes much more significant. They actually are able to offer lower costs to buyers and still earn a lot more money than freelancers from places like the United States.
In the mature markets, the goals for the freelance market tend to focus on obtaining a better work-life balance, which allows for flexibility and a desire to focus on projects that are interesting and things they want to do. Some older workers in particular are at stages of life where they are looking for flexibility, while others view it as the best way to generate income. They look to leverage the flexibility afforded with as much income as they can get."
Galit acknowledges that freelancers can experience significant stress from multitasking and looking out for themselves, and that that stress is something to consider seriously before opting to become your own boss. Putting it bluntly, he asserts, "Certainly, if you're not someone who can deal with the idea that you need to go find work and maintain relationships in order to keep the checks coming in, freelancing might not be the best role for you."
But looking at trends like the globalization of commerce to the innovation economy, Galit says all signs indicate freelancing will grow significantly in the future, and that there are huge opportunities for both freelancers and the companies that seek to hire. All you have to do, he says, is leverage your expertise to find where in the world the most interesting opportunity for you might be.