Freelancing in Australia: A National Survey of the New Workforce

Intelligent Engagement

Freelancing in Australia Study

Results DeckOctober 2014

• An online survey of 1,049 Australian adults who have earned income from work in the past 12 months

• Data collected July 19 - July 31, 2014 by independent research firm Edelman Berland

• Results are weighted to ensure demographic representation in line with the Australian Bureau of Statistics Labour Force Survey

• Overall margin of error of ±3.04% at the 95% level of confidence

Research methodology

NON-FREELANCERS

Definition:- Individuals who earned

income through work but have not engaged in supplemental, temporary, project- or contract-based work, within the past 12 months.

Sample n=738

FREELANCERS

Definition:- Individuals who have

engaged in supplemental, temporary, project- or contract-based work, within the past 12 months.

Sample n=311

Elance-oDesk commissioned Edelman Berland, an independent research firm, to conduct a study of the freelance workforce within Australia with the following objectives:

1. Quantify the number of people freelancing in Australia and their economic impact

2. Assess the state of freelancing, especially current demand for freelance services

3. Gather insights into drivers and barriers impacting freelancing 4. Gauge the outlook for freelancing, especially among millennials (AKA Gen Y)

as they become the majority of our workforce

This results deck is organised in sections to detail results on each of these objectives.

Study objectives

1. Freelancing quantified

• There are 3.7 million people doing freelance work in Australia – 30% of our national workforce

• People who freelance contribute an estimated $51 billion in freelance earnings to our economy

2. The state of freelancing

• 74% of non-freelancers say they would be willing to do work outside their primary job to make more money

• Over half (58%) of those freelancing do so out of choice rather than necessity

• The top drivers of freelancing are: 1. Earning extra money, 2. Having a flexible schedule, and 3. Having the freedom to choose which projects to work on

• 31% of moonlighters who have a primary job have thought about quitting to work completely independently – this represents more than 218,000 people

Key findings (by objective)

3. Insights into barriers and drivers

• Finding work and, correspondingly, income stability are the top barriers to doing more freelance work

• 59% of freelancers said technology has made it easier to find freelance work

• 30% of freelancers have done a project online, and of those, half find projects within three days

• 64% of freelancers agreed that social media is drastically changing the dynamics of networking in the freelancer market

4. The outlook for freelancing

• 71% of freelancers say the best days are yet ahead for freelancing and 58% said freelancing as a career path is more respected today than it was three years ago

• Gen Ys and Baby Boomers are freelancing more than any other age groups. Over a third of Gen Ys (33%) and over 55s (35%) are freelancers

• Freelancing is valued with 59% agreeing that freelancers offer skills that might be difficult to find traditionally

Key findings (cont.)

Engagement

Quantifying the Freelance Workforce

• Our survey of over 1,000 Australian workforce members rigorously screened respondents to determine the percent who earned freelance income in the past year. Results showed that 30% of the Australian workforce is doing freelance activity.

• Based on the Australian Bureau of Statistics’ September 2014 Labour Force report which estimates there are 12,350,400 people in the labour force, we estimate that the Australian labour force currently includes 3.7 million people who are freelancing.

• A November 2013 study by the Australian Bureau of Statistics found there were 986,400 “independent contractors” – which is defined as people who operate their own business and who contract to perform services for others without having the legal status of an employee. There has never been a study that includes other types of freelance workers to quantify the total number of people actually doing freelance work.

• These freelancers contribute an estimated $51 billion annually in freelance earnings to our economy.

There are 3.7 million people freelancing in Australia

The freelance workforce:5 freelancer segments

879,089

976,379

1,483,680

Each respondent ran through a series of questions that carefully qualified their employment status and income in order to detect freelancing that might otherwise go unrecorded. The following definitions and examples explain 5 segments of freelancers captured:

1. Independent Contractors (35% of the independent workforce / <1.3 million professionals) – These “traditional” freelancers don't have an employer and instead perform freelance, temporary, or contract work on a project-to-project basis.

2. Moonlighters (19% / <704,000) - Professionals with a primary, traditional job who also moonlight doing freelance work. For example, a corporate-employed web developer who does projects for non-profits in the evening.

3. Diversified Workers (23% / > 852,000) – People with multiple sources of income from a mix of traditional employers and freelance work. For example, someone who works the front desk at a dentist’s office 20 hours a week and fills out the rest of his income driving for Uber and doing freelance writing.

How did we quantify freelancers?

4. Temporary Workers (20% / > 741,000) - Individuals with a single employer, client, job, or contract project where their employment status is temporary. For example, a business strategy consultant working for one startup client on a contract basis for a month-long project.

5. Freelance Business Owners (3% / > 111,000) – These freelancers have between one and five employees, and consider themselves both a freelancer and a business owner. For example, a social marketing guru who hires a team of other social marketers to build a small agency, but still identifies as a freelancer.

In order to qualify, freelancers had to have earned freelance income within the past 12 months. The following slide demonstrates how freelancers were screened through the survey questionnaire.

How did we quantify freelancers? (cont.)

Freelancer identification: Flowchart of screening questions

Engagement

The State of FreelancingIncreasing Demand

Nearly a quarter of freelancers report increased demand for their services in the past year

Freelancers with a university degree see greater demand

3% 26% 60% 11%

1% 23% 59% 17%

Experienced freelancers see a lot of demand for their services

5% 55%27% 10%

1% 23% 64% 12%

4% 27% 55% 14%

Engagement

Insights into Freelancing Drivers

Most people in traditional employment are open to freelancing

More than half of freelancers began freelancing by choice, not necessity

So that I can be my own boss and make my own choices.

To make more money.

I see it as a way to slowly develop my own financial independence so that I can continue to make money well into the future despite my location or age or physical limitations.

I want to enjoy doing projects that have some meaning.

To spend more time with family.

To pursue my creative outlets.

Now that I am semi-retired, I can enjoy [extra income] without all the ardours of a permanent job.

So I can enjoy more free time, no stress at work, less admin duties.

To gain new skills and move my career forward.

It’s a change from the normal job, exciting, get to travel, good money.

Earning extra money is the primary reason for freelancing, but having a flexible schedule is also a top motivator

Work-life balance and appropriate pay are important to all, but freelancers also want flexibility and the ability to control their own destiny

Most important Least important

Most of us in traditional jobs probably have coworkers who are moonlighting…

10%Of all workers with a primary

employer have done work outside of their main job in

the past year to earn additional money

704KMoonlighters

The main reasons for considering freelancing is people’s unhappiness in their day-to-day work and lack of control over their career

Almost a third (31%) of moonlighters considered quitting their job – this would be 218,000 new independent professionals

218,000Potential New

Independent Contractors

Gen Y and Baby Boomers tend to freelance more in Australia

Gen Ys prioritise fulfilling and exciting work while Baby Boomers prioritise low stress, flexibility and control

Gen Ys are the most optimistic about the future of the freelance job market

Engagement

Insights into FreelancingBarriers vs. Enablers

Finding work and income stability arethe biggest barriers to freelancing more

But technology is making it easier to find work

59%Agree that technology has made it easier to find freelance work

Technology has allowed me to work

from home and autonomously.

Social media and the internet have made it

possible for me to market myself to an audience at very low

cost. The ripple effect of 'word of mouth' now

being linked with technology enables

referrals to spread ten fold.

Accessing information is far easier today. I complete tasks around 300% faster today than say 5 years ago. It helps

me provide far better quality work.

More mobile, work on the go.It is much easier to work from multiple offices and geographic locations. Organisations with tighter

budgets are looking for greater workforce flexibility.

One in three freelancers have worked online

One in four find projects online in 24 hours; half find projects online in 3 days

Technology is making freelancing easier: Two-thirds of freelancers said social media is changing the dynamics of networking

Engagement

The Outlook for Freelancing

The majority of freelancers feel that respect has grown for freelancing as a career choice

Freelancing is valued:Freelancers provide difficult-to-find skills

One quarter of freelancers expect to increase the number of hours they freelance next year

77% freelancers consider the

increase in hours a good thing

Additionally, a third expect their income from freelancing to increase in the coming year

Engagement

Appendix

Elance-oDesk

Elance-oDesk is the world’s largest online workplace. More than 2.5 million businesses and 8 million freelancers tap into www.Elance.com and www.oDesk.com to work together via the Internet. As our increasingly connected and independent workforce goes online, talent—like software, shopping and communications before it—is shifting to the cloud. This shift is freeing professionals from set-time-and-place work, while also making it faster and easier for businesses to hire. Elance-oDesk is headquartered in Mountain View, California, with offices in San Francisco, California, and Oslo, Norway.

This study commissioned by:

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