The gig economy is currently booming. As of 2020, about 35% of the U.S. workforce are gig workers. People who lost their jobs due to the pandemic turned to freelancing to support themselves and their families. Full-time employees do part-time work to secure themselves financially.
On social media, freelancing is portrayed so positively. The stereotypical image of a freelancer is someone who works less than eight hours a day but still earns as much as a corporate employee or more. They’re also always on vacations because freelancing allows them to work anywhere. While this image may be true for some, it’s not the reality for most gig workers.
Working short hours a day isn’t always the case for many freelancers. This may be possible once someone has established a strong network of clients. Or maybe that person has landed a high-paying project that they no longer pick up another one. But the reality is, many freelancers still work long hours, much like corporate employees. This is especially true for people who are just getting started.
New freelancers need to hustle as many hours as possible to get clients and promote their services. They spend time seeking potential clients, drafting proposals, and so on.
Those who have finally found clients are also likely to work more hours than usual. For example, they may not have a 40-hour workweek in one project. But they are likely to have another project or two. Juggling two to three projects at once takes a lot of time.
By its very nature, freelancing is unstable. This means income is unstable as well. In 2018, 63% of freelancers reported that they’re financially unstable.
Naturally, a freelancer can earn a lot by handling multiple projects at once. This takes a lot of dedication and strong time management skills, but it’s possible. In this case, freelancers don’t have to worry about paying their bills and buying essentials. They might even have some extra to spend on other things. Maybe they can buy some collectibles they’re interested in. They also have the budget to rent a self-storage unit to decrease their home clutter and set up a better workspace.
But these projects end almost simultaneously, leaving them with no source of income all of a sudden. This erratic cash flow makes budgeting difficult.
No Paid Time-off
Having paid time-off is very helpful. It allows a person to take a break and refocus or recharge without sacrificing themselves financially. Paid leaves can also be used when there’s an emergency. Company employees enjoy this benefit. But gig workers don’t.
Having no paid time-off can take a toll on freelancers. Burnout is a real possibility, especially if they have several clients. And it can hugely affect the quality of their work. It’s not to say freelancers can’t take a break. Of course, they can. But they don’t get compensated.
No Employer-sponsored Benefits
Corporate employees enjoy company-sponsored benefits. These include medical insurance, retirement benefits, life insurance, and many others. Some employers even buy employees food on certain occasions.
Since freelancers work for clients and are not employed by a single company, they don’t receive these benefits. Some clients may provide medical allowances or offer reimbursement for certain expenses. But this happens very rarely.
Just as Stressful as a Corporate Job
Many things can cause stress. While freelancers don’t have to worry about clocking in on time or work politics, they still have several potential sources of stress.
One example is juggling clients. It’s not always easy to handle several clients and projects at a time. A freelancer might use the timeblocking method to organize their workday. But clients from other projects can still interrupt them in a way. For example, they might suddenly demand feedback or other deliverables without prior notice. This disruption in one’s schedule can be very stressful.
Also, for people just getting started in the gig economy, finding clients can be stressful. It’s common for them to send several proposals in a day but not get any response.
Shifting from a 9-to-5 job to freelancing full time is a huge risk. And before doing that, one should first understand the possible disadvantages of going freelance.
Some freelancers on social media seem to demonize it by pointing out all its cons. But the gig economy isn’t without flaws.
Everything has pros and cons. Freelancing seems to be an ideal setup based on what social media portrays: short work hours, lots of free time, and better pay. But that image isn’t always the truth.