When Joshua Gross tells friends and acquaintances that he is a freelancer, he often receives pitying looks and sometimes even offers of full time jobs. And when he refuses them and says he is perfectly happy with his current arrangement, he gets incredulous looks.
But the fact is that freelancing and running small businesses has become increasingly popular in recent years in the United States. Approximately 12% of American adults between the age of 18 and 64 are owners of new businesses or in the process of starting one and 48% of Americans aspire to freelancing. In a survey of freelancers, 48% said that they freelance full time and that freelance is their sole source of income. By 2020, the number of freelancers is projected to outpace full time workers.
Why has entrepreneurship suddenly become so attractive?
In our parents’ generation, common wisdom held that a good job in a stable company was the safest route and that entrepreneurship was a toss of the dice. But the recent financial crisis has made it clear that there is no such thing as a stable job in the twenty-first century.
Many Americans are looking to the freelance market to offer them the stability they didn’t find in the corporate world. Entrepreneurs aren’t dependent on their boss’ bad decisions or at the mercy of layoffs. Instead, they take their fate into their own hands.
Another factor in the rise of entrepreneurs is that, due to the spread of the internet, businesses can be started on a shoestring budget. Instead of needing hundreds of thousands of dollars in startup capital, you can now start an online business with as little as $365.
Brick and mortar stores do require more capital but more financing options are available than ever before. Unsecured debt, merchant advances and Rollover as Business Startups help aspiring business people raise the necessary funds to get started.
Technology also makes managing a freelance business easier. Online time tracking, task management tools and invoicing tools help keep a business efficient and well-managed. Websites such as elance.com and social media platforms help freelancers find new projects without stepping away from the computer. Online payment gateways like Paypal ease the process of paying vendors and collecting payments.
One of the reasons young Americans are interested in running their own businesses is because of role models like Mark Zuckerberg and Steve Jobs who were wildly successful at starting their own companies. 63% of Americans in their 20s want to start their own business.
Retirees are turning to entrepreneurship as a way to stay busy after retiring from their nine to five jobs. People over 55 are the largest growing demographic of freelancers.
And a lot of people are going freelance simply because they enjoy the freedom of doing their own thing. They can work on multiple projects with various clients, using a variety of skills, and they enjoy having a broader impact on many people and businesses. They have more flexibility than nine to fivers, both in scheduling and in which projects they to choose to work on.
Freelancers also say they are more productive than they were as salaried employees. Time wasted in offices in social interaction, large unwieldy meetings and inefficient management are replaced by hard work. Job satisfaction and a payment system dependent on getting the work done lead to higher motivation and increased productivity.