New Survey Suggests Freelancers Need More Options to Improve Financial Health
A majority of U.S. based freelancers say they are in a similar – or worse – financial situation than they were a year ago.
According to a survey of over 400 freelancers conducted by Everee, 57% of gig workers say their financial positions have not improved compared to last year. Almost a third (32%) say they are regularly unable to make ends meet, while more than half (53%) barely earn enough to add to their savings.
Some freelancers are relying on loans
With financial stability being a problem for many of the respondents, a majority (55%) say they’ve had to find ways to borrow money to cover an emergency. On top of that, almost a third of those surveyed (29%) say they’ve taken out a payday loan.
“If workers face unpredictable wage cuts or have to wait too long for their pay, it can have dire consequences on their ability to make ends meet,” said Harry Campbell, a gig economy expert, in the report.
With more freelancers considering working with multiple platforms, companies should consider what motivates workers to choose one company over another. Unsurprisingly, financial related factors like higher wages plays a big factor. Over 83% of respondents say higher wages impacted where they chose to work.
Faster pay could be an answer
In addition to higher wages, the data suggests faster pay is another way companies can improve the financial health of their workforce.
According to the survey, 91% of freelancers prefer a pay frequency faster than the standard bi-weekly cycle. Among the 91%, almost half would prefer to get paid weekly (45%), while more than a third (36%) would like to get paid daily.
“It’s clear gig workers not only want more frequent pay, they need it,” says Brett Barlow, CEO of Everee. “By giving [workers] access to their pay as soon as they’ve earned it, they’ll run into fewer cash flow problems that result in taking out devastating payday loans or other debt,”
In addition to more frequent pay, Everee outlines several recommendations that can improve the outlook of a freelancer’s financial health.
1 – Improved Legislation
Better legislation in each state ensures that independent contractors can have access to better health, financial, and disability benefits. Countries including the Philippines, India, and the United States are all considering additional protections and legal rights for freelancers and gig workers.
2 – Better gig management tools
With more people entering freelancing, the workforce needs better tools to help support its workers. Platforms like Fiverr are aiming at this with its new Fiverr subscription offering, but it seems like these options don’t (yet) have the intended effect of helping freelancers.
3 – Maintaining pandemic practices
The demand for freelancing has surged during the pandemic, and it’s forced many companies to look for new ways to deliver work. Keeping things like remote work beyond a post-pandemic world is beneficial to freelancers.
“It’s 2021. We can pay a friend back immediately with a few swipes on our phone. There’s no reason we can’t do the same for every worker,” says Barlow.