How many freelancers are there?
Before attempting to count the number of freelancers in countries, regions, or otherwise, it is important to determine the perimeters of definition. What exactly is a freelancer? How, if at all, are they different from entrepreneurs? Do independent contractors count? If so, does this include tradesmen, independent retail business owners, or farmers?
Currently, there is no universal definition of ‘freelancer’. Organisations, corporate bodies and government departments instead engineer their own definitions, according to the research or discussions that they engage in. This lack of definition is one of the problems that the freelance movement faces, because it creates obstacles to painting an accurate socio-demographic characterisation of them, to be used in regulatory framework and economic analysis.
Here, we are using the definition of freelancers as outlined by the 2012 study of European I-Pros (Independent Professionals)(footnote: Stephanie Rapelli, European I-Pros: A Study, (English Version) 2012), which defines freelancers as ‘self-employed workers, without employees, who are engaged in an activity which does not belong to the farming, craft or retail sectors. They engage in activities of an intellectual nature and/or which come under service sectors.’(footnote ibid) This definition is most akin to that employed by organisations advocating freelancing and defending independent workers’ rights, relating to our main premise.
There are several reasons why the numbers are hazy:
- No official count or census expressly identifies the number of freelance workers separate from tradesmen, farmers and/or small independent businesses (eg. retail);
- There is a lack of profiling and so the number of independent workers is each count or study is dependent on varying definitions;
- Like ‘entrepreneurship’, many freelancers do no self-identify as such;
- The demographic is relatively too young to draw inferences and identify outliers or externalities within decades-old data sets;
- There is no set number of hours that must be worked in order for a worker to be considered a freelancer; and
- Manny freelancers, due to difficult administrative procedures, red tape, and high taxation, are not self-declared.
Despite these reasons that make it difficult to count freelancers, it is useful (and important) to identify the rough proportion of the workforce that we are discussing. The most effective way to give an overall number is to look at regional statistics; for the purpose of this analysis, we are comparable economic regions of the industrialised world, namely, the US, the EU and Australia. This is not to say that freelancers are less prominent or influential in other regions – indeed, they have a slightly different role to play – but these circumstances will be discussed later.
What is clear, if not the exact number, is that freelancing is becoming more popular around the world, and the proportion of professionals who choose an independent career is growing at an astounding pace. All censuses and independent industry reports that have surfaced in the past few years identify an incredible percentage growth of this working demographic.
The United States
The US currently has the highest real number of freelancers in real terms than any other country. The last official census in 2006 put the number of the contingent workforce – those without a permanent contract at a single workplace – at 18%. Two per cent of those were labourers.
There are more recent unofficial counts, but they vary greatly, with estimates between 34 and 60 million freelance workers. To give some perspective, the Freelancers Union in New York puts the number at 42 million, however they include anyone who has worked as a freelancer for more than 1 hour, which is unsustainable, and they lie outside of the demographic that will instigate change.
More current official statistics are more remarkable: between 2009 and 2012, the Bureau of Labor Statistics found that the number of temporary employees increased by 29%. This is yet to be qualified and put into context in the official census, though it no doubt represents a fundamental change the American workforce, and one to be considered in current policy decision-making.
The European Union
Freelancing is similarly important in the EU. A 2012 study by the European Forum of Independent Professionals (EFIP) found that, between 2000 and 2011, the number of freelancers rose by 82% to 8,569,200.
According to this study, Italy has the most freelancers of any EU country in real numbers, with around 1.68 million independent workers. This is likely partly explained by the high level of unemployment that the country faces, and so as people are laid off, they opt to register themselves as a freelancer, rather than unemployed.
The EFIP study cites Germany as the next largest freelancer economy with an approximate 1.53 million, but other studies find differently. The Deutsche Institut für Wirtschaftsforschung, or the German Institute for Economic Research, put the number at 2.6 million in 2011. This was the result of a 40 per cent increase since 2000.
While this only (currently) constitutes around 6.5 per cent of the workforce, it was considered big enough to signal a new law aimed at fixing the broken pension system, and which required all freelancers earning over €400 per month to pay a minimum €350 retirement contribution.
The United Kingdom has the third highest number in the EU with 1.6 million, or one in every 20 workers.
Similarly in Australia, a move by large companies to outsource work, and a growing desire to succeed alone, means an estimated 2.1 million people – or 19% of the nation’s workforce – are now self-employed.
Independent professionals are defined as freelancers, independent contractors, or members of a small business start-up, so if employing the definition of ‘freelancer’ as used by unions and support groups, etc, this number will be lower.
Australian research on this trend confirms that the number is on the rise. Supporting this, 91 per cent of survey respondents reported being generally happy with the kind of work they did as a freelancer, and the majority cited benefits including lifestyle and wellbeing.
Again, without any current or comprehensive official counts, it is near impossible to reach any number with exactitude. What is clear, however, is that the freelancer demographic is already significant, and is on a steady rise. This fact alone is enough to warrant engaging in conversations about the impact of the freelance employment market on the wider economy, and the impacts of the existing legal structures which, if left unamended, could have dire repercussions on the independent workforce and society as a whole.