Future of work: how the freelance revolution is changing the meaning of a ‘day job’

Published 08 May 2014 12:20, Updated 09 May 2014 10:53

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Future of work: how the freelance revolution is changing the meaning of a ‘day job’

A growing number of Australians are trying to escape the rat race. Photo: Alan Moir

Across Australia many employers have realised that developing and promoting an appealing working environment is an effective way to both attract and retain staff.

But even these efforts are proving insufficient in gaining the services of an increasing number of Australians, who are cashing in job security for a more flexible working lifestyle.

The exact number of Australian that are leaving full-time employment for life as a freelancer (also known as a ‘soloist’ in some circles) is hard to define – in part because many of Australia’s freelancers are actually moonlighting after working hours.

This is seen in figures from the Australian e-commerce platform provider BigCommerce, which has found that more than half of the work done by retailers who use its software is conducted in the evening. This suggests many online retailers are working a day job and running an e-commerce site at night.

Freelance economy

The United States in particular has seen a rapid rise in the so-called freelance economy, with freelancer numbers projected to outpace full-time workers by 2020, according to business services firm MBO Partners. The McKinsey Global Institute has also suggested that 160 million jobs – approximately 11 per cent of the world’s 1.46 billion service jobs – could be carried out remotely.

While many of these freelancers work in traditional contracting arrangements, for a growing number work is facilitated through the numerous online outsourcing marketplaces, such as Freelancer.com, oDesk and Elance.

The last of these two recently merged, and as Elance-oDesk now claims more than 161,000 Australian businesses registered with their services. The company has also reported growth in Australian businesses hiring through its platforms of 235 per cent over the last three years, with a combined spend of $US145 million. Elance-oDesk also reports that more than half of Australian businesses plan to hire more freelancers in 2014 than they did in 2013, based on its own research.

Rival Australian-based company Freelancer.com, which listed on the Australian Securities Exchange in late 2013, claims to provide access to 11 million freelancers around the world, with more than 4000 jobs being posted every work day.

Freelancer.com’s regional manager for North American and Oceania Nikki Parker says the most common jobs posted by Australian users of the site are in the fields of graphic design, website development and content writing.

So far the service is proving most popular with small businesses, with Parker estimating that 92 per cent of users around the world working in businesses with 50 or less staff.

“Increasingly small and medium employers are engaging freelancers, because it is a cost effective and flexible way for them to grow their business without the often unaffordable expense of hiring full time, or the impossibility of finding the right employee with a specific skill set,” Parker says.

“For many Australian businesses or freelancers there is a limited local client pool. However, working through an online marketplace opens up a world of opportunity, and allows Australians to work with clients and on projects that would have previously not been visible or made available to them.”

Another Australian company prospering from the growth in use of freelancers is Sydney-based Airtasker, which enables people to hire freelancers for tasks ranging from handyman help to IT support and even home or office cleaning.

Co-founder Tim Fung says the company saw the number of tasks posted double in the first quarter of this year with 120,000 registered community members, and Airtasker is now processing more than $3.5 million in annualised task revenue.

Fung says there are three distinct categories of people who are performing tasks through the site: university students, older professionals, and semi-retirees.

“Surprisingly, the most active and fastest growing segment are the semi-retirees which we believe are so successful on the platform because they have amazing experience and life skills but also the ability to share their time to help the community,” Fung says.

Skills and affordability

These services are now underpinning a number of Australian employers by delivering skills from around the world at an affordable cost.

Newcastle-based former lawyer Kim McFayden has been a long time user of online outsourcing, and is now using them to help build her new business, an online marketing service for lawyers called Lawcorner which will launch later in May.

McFayden says she uses the services for web development, writing, search engine optimisation, graphic design, video and written content creation, and virtual assistance.

“Basically my whole team is outsourced as I am a solo founder,” McFayden says. “I freelance any of the competencies that I need, or don’t want to be doing, or am not good at doing.”

McFayden says these platforms give her access to more skills than she could access in her local market, at a more affordable cost.

It is not just start-ups who are taking advantage of online outsourcing. The managing director of Northern Territory-based talent booking agency Primetime Entertainment, Bernard Wilson, says using oDesk means he can run the Territory’s largest agency with just two people.

“We spend most of our time attending to the service aspect of the business and not worrying to much about the back end, which is where oDesk comes into it,” Wilson says. “I can spend more of my time with clients and less of my time doing those other things which all small business owners have to do.”

But Wilson cautions that not all freelancers represent themselves appropriately online, and the model has only succeeded through trial and error.

“There is a lot of fear with outsourcing your business operations,” he says. “But the one thing you do have to invest in is the right business systems, so you can plug in those different offshores workers in a secure and highly collaborative ways.”

Numerous models for organising freelancers are also emerging that aim to reduce the bumps that clients might suffer. Virtual Coworker for instance has been set up specifically to recruit and train Philippines-based workers.

Business development manager Kevin Mallen says Virtual Coworker recruits staff to meet the needs of its clients, and handles their payroll and human resources requirements.

“Essentially the staff in the Philippines become the client’s employees and are working in their time zone and are in touch with them on a daily basis,” Mallen says.

In the last two years the company has grown to employ 80 staff and expects to have added another 20 by early in the New Year.

He says Virtual Coworker picked the Philippines due to the quality of its university graduates.

“There are about 400,000 new university graduates each year, and a lot of them are studying to work for Australian and US companies,” Mallen says. “They know our laws, they know the way the clients out here work and what they are looking for.”

Maureen Shelley and her business partner Dominique Antarakis run a team of freelance writers, photographers and designers under the name The Copy Collective. Their business has grown from a dozen freelancers a year ago to more than 80 today, managed by five full time staff.

Shelley says would-be members are put through an exhaustive induction process and undertake ongoing training. In return The Copy Collective provides professional indemnity and public liability cover, as well as work. Jobs are allocated to freelancers whose skill sets are appropriate to the task, and each works at the level they want to.

“Some people earn $8000 a year with us because that’s all the work they want,” Shelley says. “Our top paid person gets $144,000 a year, and we have lots of people in between.”

Freelancers are sourced from around the world and range from university students to retirees, many of whom have multiple tertiary qualifications. Shelley says some are home–based carers, while many are fulltime freelancers.

She is adamant that not everyone is suited to freelancing.

“A lot of people go into freelancing saying they can write, and they think they’re a freelancer,” Shelley says. “And they’re just not. They don’t get it. They turn in sloppy work, they don’t respond to emails, they turn in things late, they don’t check sources, and they expect everything to be done for them, and don’t treat you with respect.

“People who run their own businesses and are used to managing clients, they are the ones we love.”

Thankfully help is at hand for those who want to get into freelancing. In July this year Melbourne-based entrepreneur Bjarne Viken cofounded the website Digital Mined to teach freelancers how to build successful businesses.

He says many freelancers make simple mistakes such as failing to specifically respond to the client’s requirements, responding with spelling and grammatical errors, and not articulating their areas of specialisation

As a long time user of freelance services, he has witnessed a significant shift in the mix of workers in the marketplaces, and their expectations of income.

“A couple of years ago I struggled to get staff from the UK, Canada and the US at the rates that I was setting,” Viken says. “But now if I put out a project I might get five or six candidates from those markets.

“We are going to see a shift where a lot of work that is priced at a higher level in Western countries going to go down in price quite simply because it can be outsourced.”

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