The year is 1194. Maurice De Bracy, enemy to the English crown, is locked in combat with a mysterious Black Knight. Suddenly, the Black Knight gains the upper hand. He whispers his true identity in De Bracy’s ear: King Richard the Lionheart of England. De Bracy yields. Later, De Bracy offers to let King Richard use his army of “Free Lances,” mercenary soldiers who were free to use their lances in service of whoever paid the most.
That’s how it plays out in Sir Walter Scott’s 1819 novel, “Ivanhoe.” Scott didn’t coin the term, but it was probably this use that stuck, and evolved to describe someone who works independently of any single company.
That independence seems to make people happy. A 2016 survey of freelancers in six countries found that those who freelance by choice— 70% of respondents, by the way— were happier than people in traditional jobs, specifically when it came to things like independence and flexibility in terms of where and when they work. In a survey conducted in the US, half of freelancers said there was no amount of money that would convince them to rejoin the traditional workforce.
At some point in your life— maybe even now— you might wonder whether freelancing is right for you. You'll need a few things to be successful.
First, you'll need a skill that's in demand. This can be as universal as driving a car to as specialized as neurosurgery, and it can be in pretty much any field.
The more people who want your skill, and the fewer people who have it, the more you can charge for your services.
Next, you’ll need to transform yourself into an entrepreneur. Before freelancers can do any work, they have to find it. That takes marketing your services, negotiating contracts, building a network of satisfied clients, and a whole set of administrative skills like project management, time management, and accounting.
And thirdly, if you can afford it, it's probably a good idea to budget for some benefits for yourself and maybe your family. Freelancers don’t automatically get perks that some salaried jobs offer, like paid vacation or sick leave, life insurance, college tuition, or retirement plans. In countries like the US, where the government doesn’t provide healthcare to most people, freelancers are responsible for that, too.
Freelancing has been around for a long time; but digital freelancing platforms like Uber, Lyft, and Fiverr are pretty new. They say they’ll connect you with clients and take care of some of the entrepreneurial and administrative stuff so you can focus on the work. But there are some hidden costs to consider.
First, your life may not be as flexible as you think. For example, if you're a rideshare driver, you get to choose when to work, but not how: the app recommends what route to take, enforces how you act with the threat of low customer ratings, and sets your rate. Those rates may be so low that you end up working more than if you had a salaried full-time job.
Speaking of rates, it can be hard to figure out exactly how much money you’ll make. Earnings vary based on location; platforms might advertise hourly rates that don’t factor in expenses, and large scale data on actual earnings is sparse. One of the largest data sets we have is from Uber. It contains 740 million trips by 1.8 million drivers between 2015 and 2017. Researchers analyzed these figures in a 2018 paper and found that once you deduct Uber's cut and the cost of business expenses, drivers’ average earnings dropped from about $22 an hour to about $12 an hour. And buying benefits would reduce that number even more.
And there is a lot of variability in working conditions across different gig platforms. For example, the company 99 in Brazil operates a rideshare platform that many people use to deliver packages. Drivers are matched with shippers, and 99 takes a cut. The company’s terms and conditions hold both the shipper and the driver liable for anything that could go wrong— including things like if a package gets stolen.
If you’re considering joining the app economy and don’t want to read all the fine print, there’s a network of researchers who publish ratings of platforms based on five categories of fair employment.
Digital gig platforms come with drawbacks and may not provide a reliable living wage. But for many around the world who don’t have the luxury of choice and need to make money as soon as possible, like, say, if you just lost your job, the gig economy is the easiest and fastest place to get hired. For this reason, some have called it an “alternative safety net.”
So, considering all these factors and many others, should you dip your toes into the gig economy? Or dive in? Ask yourself: how much do you value flexibility or autonomy? Do you prefer to work within an established structure, or to make your own? Are you willing to network to find new clients? Are you organized and self-directed? And perhaps most importantly, how much do you value knowing exactly what you'll earn from week to week?
