Freelance jobs offer surprising pros—and cons
Nearly 55 million Americans have chosen the “gig economy” over traditional full time work. This is why you might want to join them.
We as a society are immersed in a new era of work that’s more project-focused and independent than ever before. Long-gone are the days of working for a company for 25-years to get the gold watch: The 9-to-5 (or 6 or 7) brick-and-mortar office job isn’t the only option anymore. Freelance jobs are helping workers reclaim their independence.
According to a study by the Freelancers Union, the numbers tell all: Approximately 57.3 million Americans are doing freelance work (up from 55 million in 2016), comprising 36% of the entire workforce. This figure will rise to 50% in 2020, according to a Time magazine article. (Check out the number of freelance jobs on Monster, and you'll see there's no lack of opportunity.)
The Freelancer’s Union says freelancers contribute an estimated $1.4 trillion to the U.S. economy annually, and 63% of respondents started freelancing more by choice than necessity—a 10% increase from 2014.
But for workers, the freelance—or “gig”—economy cuts both ways, says Time. The article in question discusses some of the drawbacks going so far as to say a “freelance workforce means a permanent state of non-permanent wages,” also citing research from Pew that says average hourly wages may have peaked in 1973 at $4.03 per hour (that’s $22.41 in 2015). Thus, a wrench is thrown into the gears of the freelance economy, a system almost totally reliant on hourly work and commensurate pay.
Either way, we’re seemingly at a point in history stuck between the future of the workforce and the way it always was with full-time jobs.
Which means you have options.
Before deciding which path to take, you’ll want to weigh the pros and cons of each to see which scenario is right for you. The main point to remember? Adaptability. Over time, your situation and needs may change.
Pros of freelancing
- Freedom with a flexible schedule, hours and location
- Ownership: you call the shots
- Selectivity with clients/choosing who you want to work with
- Unlimited earning potential
- No commute/no commuting costs
- Getting to pursue your passion projects
- No office politics, annual performance reviews, etc.
- Casual work attire (sweatpants, anyone?)
- Running every business aspect (sales and marketing, invoicing, signing, contracts, troubleshooting technology, keeping track of tax deductible business expenses, making estimated tax payments, etc.)
- Tackling a variety of projects and clients
Cons of freelancing
- Feeling isolated
- Hustling 24/7 for new gigs
- Inconsistent work and cash flow
- Juggling multiple clients
- Instead of having one boss, you have several clients to answer to
- No paid time off, no maternity/paternity leave
- No company-sponsored health benefits, 401(k), etc.
- No one to back you up if you're sick or injured
- No eligibility for unemployment benefits and COBRA
- Running every business aspect (sales and marketing, invoicing, signing contracts, troubleshooting technology, keeping track of tax deductible business expenses, making estimated tax payments, etc.)
- Feeling scattered/unfocused and lacking structure
Full-time employee pros
- Steady paycheck
- Surrounded by colleagues in a team environment and a boss to guide you and give feedback
- Structure and consistency to your schedule, hours and location
- Company benefits, 401(k), etc.
- Paid time off
- Consistent workflow
- Infrastructure for support like a technology help desk, benefits contact, etc.
- Eligibility for unemployment and COBRA
- Focusing only on delivering work instead of generating new work, sales and marketing, troubleshooting, etc.
- Not responsible for estimated tax payments since taxes are withheld from paychecks
Full-time employee cons
- Limited earning potential
- Subject to office politics, gossip, etc.
- Potential boredom and lack of variety
- Limited flexibility with schedule, hours and location
- Lack of freedom
- Less sense of ownership
- Feeling stuck if there's lack of mobility
- Commuting costs and time associated with it
- Budgeting for work attire and meals/coffee breaks
- Lack of time, energy and/or focus to pursue a passion project
Monster’s career expert Vicki Salemi has more than 15 years of experience in corporate recruiting and HR and is author of Big Career in the Big City. Follow her on Twitter at @vickisalemi