Freelancing in America is huge. As a European, it can seem almost unbelievable that roughly 34 % of the entire working population actually work as some kind of freelancer. Even more so that in 2020, this number is estimated to be 50 % by EFIP.
In other words, half of the American population is not expected to have a regular full-time job in 2020! – Think about that for a second.
But really, this is not what this blog post is about.Because most people already know that the freelancing business is booming in America. If you want to read about the booming freelance business in America, check out this report.
Freelancing is though no longer juts an American phenomenon. The European Labor Market is experiencing a rather rapid rise of freelancers.
It is quite clear from the graphic below that freelancing is becoming increasingly popular across Europe. Particularly countries as the Netherlands, Poland, France and the UK have experienced a very eye-catching rise of freelancers.
Note than freelancers in the below table is defined as Ipros. Ipros stand for independent professionals, which is just a synonym for freelancers.
In general, all 27 members of the European Union have increased a noteworthy 45 % from 2004-2013. This growth is remarkable because no less than 7 million jobs were actually lost in these 27 countries in that period. Click here for a full list of all EU27 countries. In total, the number of freelancers in the European market was measured to be 8,9 million in 2013.
This growth actually makes freelancers the fastest growing segment in the entire labor market. Also, since 2008, the number of freelancers has grown within every single professional work sector. And grown significantly more than the total number of employed within these sectors.
Overall, employment rates have gone up by 3 % since the end of the recession in 2008. But the number of independent professionals has increased by 17 % (EFIP).
This speaks of a shift in the labor market. A shift that provides companies with great opportunities to scale their business. Not, at least, opportunities to tap into the world of talented and skilled workers across the globe.
There is no newer statistics about the European group of freelancers. Yet, new investigations in the United Kingdom reveals interesting expectations among British HR professionals. Around 50 % expect independent workers to make up at least 20 % of the workforce, in the company they work for in 2016.
Also, recruitment companies hired 9 % more freelancers in 2015 than 2014, on behalf of their clients. To top it off, a new report from the British (NFIB) revealed that 84 % of small UK businesses can’t find qualified people for open job positions. This speaks of a huge need to tap into a flexible workforce.
Phew! This was a lot of facts about freelancers, independent professionals, flexible workers or whatever we call them.
These facts all points towards one trend: an increase in the number of freelancers and the need for them. We also know that the freelancing business is expected to explode in America. Based on this, it seems safe to conclude that the freelancing business in Europe is only likely to have grown from 2013 to 2016.
The pattern is therefore clear – Freelancing is spreading across Europe and will most likely only continue to do so.
But why do full-time employees go freelance and why do companies hire freelancers?
The short answer to that question is that people like to work freelance. Moreover, that companies increasingly realize that they need flexible workers.
Of course, it is though not that simple at all. Firstly, several external factors have contributed to the rise of freelancers such as:
- Technological developments (Connecting freelancers and companies)
- Globalization (Bringing the world closer together – Limiting cross-border barriers)
- Explosive growth in emerging markets (Making it possible for firms to tap into the great level of talent spread across the globe).
The external factors have been important because they have enabled freelancers to thrive. This has also given companies easy access to the flexible workforce.
However, it is, of course, freelancers who have created a supply of flexible workers. And companies that have created a demand for independent workers.
High supply of freelancers
When the recession hit hard in 2007, many were laid off and were forced to try out the life as a freelancer. Slowly though, these people started thriving and never ended up coming back to the previous 9-5 everyday life. 50 % of American freelancers even state that no amount of money would ever get them to go back to a regular full-time job.
Ever since, people have only become more self-aware and focused on following their dreams. Not at least aware that thriving as a freelancer is certainly possible.
According to freelancers (American), the three greatest benefits of being a freelancer are:
- Flexibility in the work schedule (25 %)
- Variety in work (15 %)
- Being your own boss / ability to work from anywhere (14 %).
In addition, freelancers actually earn more money on average than regular employees! These are all important reasons why we now have a great supply of freelancers.
High demand for freelancers
Companies have no doubt increased their demand for freelancers over the last decade. In the beginning, it was mostly small businesses that hired a few freelancers here and there to be able to scale their business. Large enterprises simply hired the people they needed on a full-time basis. This is no longer the case!
Today, all types of companies, within a variety of industries and of different sizes, uses freelancers to scale their business. When scaling their business, they improve their capacity over a short period of time without losing capacity in the long term. Besides, it puts no economic long-term pressure on the company to perform. Particularly large enterprises have realized that they can benefit from using the flexible workforce.
As mentioned in another blog post, data from 2009-2012 shows that 22 % of all employees in 200 of the largest companies in the world are freelancers of some kind. In the same period, the use of independent professionals also increased with 29 %! If this significant increase has continued since 2012, freelancers are today a huge and significant part of running a succesful large-scale business.
So, what have we learned?
The freelancing business is expanding in Europe, not just in the US. There is an increasing number of freelancers, an increasing demand for flexible workers and nothing suggests that this trend will stop.