Why Most Designers Will Be Freelancers Within 20 Years

Designers to FreelancersThere’s been a big trend in the design industry lately, with people from all levels of design turning to freelancing. But the trend is even bigger than a lot of people imagine, and very quickly the industry balance is tipping towards freelancers.

Given the major elements at play, there’s no reason for this swing to stop, or even slow, in the next few decades — and pretty soon the majority of designers are going to be freelancers.

What leads to this conclusion, you ask? Here are three major reasons that most designers are going to be freelancers within the next 20 years:

The Costs of Freelancing are Plummeting

The trend of working at home, or working freelance, has been greatly bolstered by the lower costs of technology and communication.

It’s possible nowadays to build an office at home, for only a few thousand dollars, and still have the technology to work and communicate around the globe. Technology costs are so much lower than they were years ago, and the result is that it’s easier now to set up an effective freelance business for much less money — which means more people are going freelance.

Think about Skype, for example. It alone has created the opportunity for thousands of freelancers and clients to do business across the globe. Because of Skype there many people who started a freelance business that would have been unable to otherwise.

The cost of setting up this global communication? Maybe $25 for a decent headset.

These new tech improvements, and constantly lowering costs, are creating what amounts to the perfect storm for starting a freelance business. All of the things we freelancers need to get started are not only improving, but are also becoming less expensive. In the coming decades this will draw many people into freelancing.

Corporations Are Hiring Freelancers Instead of Employees

As the global recession continues, more and more corporations are cutting costs — and laying off employees. These companies need to cut expenses, and maintaining an office with full-time employees has a lot of overhead.

Hiring freelancers, on the other hand, has no overhead at all. Freelancers can be hired extensively for a big project, and then not paid a thing when a company has no work. It’s the most scalable and on-demand solution for many situations, and a lot of companies are coming to the conclusion that freelancers are the least expensive option.

And when the world economy starts to recover, as is typical with post-recession economics, there is going to be a severe shortage in man-power due to the extensive lay-offs. Guess who fills in the gaps? Freelancers.

Typically these “stop-gap” freelancers convert back into normal employees after awhile, but given the lower costs of freelancing, the differences in the newer generations, and the increasing risk associated with large overhead, it could be a very long time before that swing happens.

Based on these trends, the number of freelancers will be exploding over the next several years.

Younger Generations Love Freelancing and Independence

The final trend at work here is the average age of the design community, which is somewhere in the 25-34 year range, and rapidly getting younger.

This age group no longer sees a job as secure. After watching (or experiencing first-hand) the number of lay-offs and firings that have happened in recent years, most younger people are more apt to rely on themselves than the promises of a big company. Add into the mix the promises of independence and potential prosperity, and it’s clear why this generation so distinctly favors freelancing over getting a job.

With the nearly non-existent technological barriers to entry, the perfect catalyst in the global recession, and an age group that prefers freelancing to a job, it’s clear to see that the design industry is in for a significant change over the next years and decades.

In 20 years, it looks like the vast majority of designers will probably be freelancers.

Are You Prepared?

Are you prepared to deal with a significant number of new freelancers in the coming years? Have you created a business that can handle the incoming competition, and the new business when the economy improves?

Are you ready for more and more of your business to come from other freelancers?

Or, do you disagree with this prediction entirely? Do you think I made a mistake or missed something significant in the post?

Share your thoughts in the comments.

top image by Trekkyandy

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Comments

  1. says

    I’d say pretty spot on, though I’m not sure that the trend will carry on for that long. Eventually the market would get too crowded and then people have to start working together by setting up studios in order to cash in on the big jobs. Freelancers outsource work to other freelancers but they are more expensive to employ if you are reeling in the big jobs constantly. I think the best of the best will eventually turn into studios.

    I think the best point is your last one. I’m 21 and I have already started freelancing on the side, and on top of the 3 of my friends that went to Uni with me have all started freelancing and as a group we are already feeding a lot of work to each other for each of our specialities.

  2. says

    Why rely on a company that might drop you to younger talent in 20 years. Why not grow for yourself and get your name out there.

    Some of us will never be happy going to that regular 9-5 job. But it takes lots of strength and perseverance.

    I quit might job and have been a freelancer for almost 1 year now and tell you that there is no way I will ever go back to a regular job.

    -FP

  3. says

    Is there any quantitative evidence to substantiate that this is a “big trend?” Seems like the entire article depends on this minor point and it would deserve something beyond just declaring it to be so.

    I’m not disagreeing, I’d just like to see something that actually suggests this is happening other than a few people saying it is.

  4. says

    @Rich — Ahh, but why set up a studio when you can create a distributed team of freelancers? I know a lot of big-time freelancers who have decided to partner with other people across the world, and continue working from home as a team. Whether that is still freelancing is debatable, but it still isn’t a studio…

    @Pohl Media — Yup, that’s exactly the trends I’ve been seeing lately. Congrats on getting started :-)

    @Matt — There’s not too much quantitative evidence out there on this exact subject, but there is a lot about the ancillary points. For example, in a downturn companies have been known to switch to hiring freelancers. See this article for one source of that information: http://www.odesk.com/blog/2009/03/companies-increase-outsourcing-during-recession/

    Another source of quantititative evidence is from the Bureau of Labor Statistics, which has been pointing for a rise in freelancing for years now. Here’s an article summarizing that: http://www.cnn.com/2009/LIVING/worklife/01/14/freelance.nation/

    For some very recent statistics, check out this article about some information gathered by a Payroll company, which points to a very sharp rise in freelancing over the past few months: http://smallbiztrends.com/2009/04/small-businesses-say-we-want-independent-contractors.html

    So, there is some evidence out there that supports several of these points, but overall this is still fairly hypothetical :-)

  5. says

    I agree – I think this is a perfectly reasonable forecast.

    The funny thing is … I’d *like* to find a studio job to be around other creatives, learn from them and have a steady pay check. But the competition is fierce and openings are shrinking. In the meantime, I have contacts who need design work done which means my bills get paid and I work with people I like. Suddenly I find myself in my own office working independently and steadily in a niche I love (non-profits). My coworkers are friends also working on their own in web and film, and we contract out to each other when those skills are needed.

    Another point I’d include within the cost factor is a free education through design blogs. What normally would have been developed in a studio job, I am learning daily in my RSS feeds – everything from managing my time, how to deal with hard clients, invoicing and even photoshop tricks. This has enabled me to take on freelance and feel supported.

  6. says

    I am definitely seeing a trend in an increased need for freelancers. In a recession, it seems that lots of people are starting up their own business ventures, which is wonderful for web designers/developers, because it seems like there infinite amounts of people looking to get a site designed, or to redesign an existing site.
    I just quit my job a month ago to go full-time freelance, and I can barely keep up with all the work I have on my plate! It seems to me that during a recession is the best time for freelancers to succeed!
    I don’t think the freelance lifestyle is for everyone… but if you love what you do and produce good work, and don’t mind the scattered income, its well worth it!

  7. says

    Mason, that was a great article! It makes you think. Here’s one more reason why I tend to agree with you:

    A lot of role models: More and more designers are turning to blogging, sharing their experience about design, but also about freelancing in general. With all this information at hand, people will start to feel more comfortable taking the big step (because for most people, freelancing full time is a big step).

    On the other hand, some might be mesmerized by the “magic” of a stress free (no boss, right?) work at home life, where you do what you like and make tons of money. But they will soon find out the biggest reality of working at home: you still have to work! :O

    So I don’t know if we’ll see that many people turning to freelancing, but there will certainly be an increase. Worried? Never! ;)

  8. says

    What I like best about freelancing is that I am in control of my own destiny…not subject to interoffice politics and/or a boss who may or may not be competent. Freelancing is taking total responsibility for oneself and that is a great thing!

  9. says

    I agree with your prediction and not just for designers but other fields as well. Before I left my office job, we were even outsourcing administrative tasks. Outsourcing is much more affordable for companies: no benefits, no overtime, no paid vacations, minimal training. It’s a win-win!

    You asked the right question: are freelancers ready for the demand… and the competition?

  10. says

    Great article, excellent points. I’d like to expand @Lexi Rodrigo’s point to include developers. I’ve gotten a few jobs for development work from past employers since I started freelancing. It’s great because they already know me, and we already understand each other.

    One other concern about increased freelancing, in the US at least, will affordable healthcare (or the lack of it) be a barrier to more freelancing? That’s probably the biggest drawback keeping me from going full time – benefits for me and my family are either impossible to get, or impossible to pay for. Don’t mean to get political, but I hope politicians notice this trend and take it into consideration when discussing health care reform!

  11. Jon says

    I agree – but I think it’s going to take awhile, and I don’t know if it will ever be “most”

    It’s very difficult to replace what can be accomplished by face-to-face contact. The younger generation has gotten quite skilled at that, but they are still the younger generation.

    The people in charge, the presidents and vice presidents of most companies, still are old school enough where even relying on email can be difficult, let alone IM or Skype. Until that generation retires and the current generation moves up a few rungs, I don’t think we’re going to see the majority of designers being freelancers.

  12. Patricia O. says

    I also agree but not completely. Yes, the younger generation have become more open to the idea of working freelancing but there are PLENTY of obstacles along the way. I found many of recent college graduates (especially from my art school) unable to handle contracts, negotiate prices, and deal with client demands. While the experience is good and we’ve all encountered shady clients, bad designs and stolen code looks bad on a portfolio for a recent graduate. That is why I think Freelance Folder is a blessing and I forward this site to as many people as I can.

    I would suggest younger designers to either have an intense internship at a design firm or at least one year at full-time job to learn from others, network and build a strong professional portfolio.

    Also Lexi, outsourcing is not all that great. Most of the time, when we get the code back its either 1. The site now doesn’t work 2. They’ve re-written code and our developers have to go back and make some major corrections. It’s not always a win-win.

  13. says

    @Kristin – Get started at elance or Guru, Vois is a new place.

    It took me weeks but I now generate my regular income from both of those places. Make sure you talk to your clients on the phone if you can.

    Only thing I would have liked the article to end in a positive note. While freelancing is not for everyone is very fulfilling to be the owner of your own work and reap the benefits of a project well done.

    Maybe instead of Are You Prepared? — Send you to some places where you can get some pointers on how to make your site stand out from others or other tips so you can make it against the competition.

    ///

    Great website!!! Go Freelancers.

    @Mason — I agree with you. I guess what is considered a Studio now days? When you start really making lots of flow and can afford a large office. I work with people in NY, London and Australia all the time to get projects completed and my need to grow is in needing more hands to finish up project but I do not look forward to paying utilities or having an local office any time soon.

    Would the majority prefer a Local office to a Home office?

    @Jon – I believe your point. It seems I keep connecting with other companies that are the ones that have the business connections to the large projects. They are charging a nice price but then come to the freelancer for a very low fee and get their projects done. The older people still seem to have that face to face connections to the higher corporate latter people.

    Only bad thing about freelancing here in the US is we are responsible for an almost 40% tax on anything we make. So start saving from everything you make online.

  14. says

    ‘there’s no reason for this swing to stop’ – no reason for it to stop *now* – things will doubtless change in the future, and Patricia O raises a good point about the (general) lack of other skills freelancers straight out of school/college will have.

    Nonetheless, good topic for an article!

  15. says

    Totally agree.

    I’m also with Lexi, we see more and more Writers, Editors and so on going solo. I believe we are ready for the challenge, that’s why we chose to do this. Also, because you are a freelancer, you don’t HAVE to get every single job that comes along. You have to be selective and you learn this with time.

    I think however, some Freelance hiring sites are taking advantage of the situation. A lot of companies will opt for “Cheaper is Better” mentality, which is not always a good deal. But that’s up for another subject.

  16. says

    I have to disagree with this article and I am a freelance designer who has set up my own studio on recently. Your looking at this from the designers point of view, speculating age range and future trends but this may apply to where you are but may not apply world wide. You need to look at this from a clients point of view, not some bar owner who needs an identity but how about a large company who tenders out big design and marketing projects.

    The fact remains that freelance is great for more flexible work, but large scale projects tendered out by a big client will never be given to a sole freelancer. There are loads of reasons for this, financial and security being paramount. A big client wants the security of working with an agency, working with project managers and reputations.

    Freelance is great for smaller work, collaborations and freedom but if you start collaborating with more people, bringing in say web designers, copywriters then your turning into a studio and being less of a freelancer.

    More people are turning to freelancing who I know as companies have the budget with projects to hire a designer but take anyone full time, so it’s a good opportunity to tap into this market but saying most designers will be freelancers within 20 years is far off the mark. I think it will be the same with everyone getting a share of the workload.

  17. says

    I am a self-employed freelance designer and I’m working on a 6 figure website at the moment with 2 other freelancers. I work out of my house tend to do a lot of work for larger companies.

    I just don’t think that freelancing means you have to do menial work or smaller projects. I think if you’re good at what you do then you’ll have plenty of work and pick and choose the freelance projects you want.

  18. says

    I have to say your article may be spot on with current trends. I do see an increase in freelancing and younger ages. Hell, I started freelancing last year when I was 16, but I knew web design and development when I 12 (I’m only 17 and I have had a a lot of experience).

    Freelancing is good job to make money off what you love to do. I love to design and develop web sites, so I started freelancing in September of 2008 and I love it. I may not be the best freelancer, but I’m enjoying the clients I get and the learning experience from it. Without freelancing, I wouldn’t be where I’m at now.

    I encourage people to freelance whatever they do, writing content, designing websites, making logos, whatever! It improves your skill and you make money off something you love. What is better than that?

  19. says

    @John Instruct – I disagree with your point

    @Jay Kerr and completely agree with you.

    John said “A big client wants the security of working with an agency, working with project managers and reputations”

    You built your own reputation by working for yourself and growing your own company. Doing more work and getting better and handling both design, project management and the selling and marketing of your services.

    I work with large clients too. Small clients, whatever comes along. You take what you get and move up from there. Always trying to built what you have, your name and your brand.

    Take Brian Gardner from revolution themes – Where do you think he got started? His reputation in the WordPress world is huge now, thanks to the success of his themes.

    –Point being if you work for others, it will be their name in the headlines.

    Freelancing is not for everyone!- I am more profitable working from home than working 40hrs a week with yearly promise of a raise.

    But you are right! – Not all designers will be freelancers in 20 years. There will be the ant workers piling up into their cubicle.

    I recently had a colleague that worked for Disney – He said he never imagined working for disney as a web developer would mean sitting on a cubicle with no window and sky in site. Pretty boring if you lived the cublicle life yet.

    —-

    Elance for me has been very profitable. I have people that will argue with me otherwise but – If you dont try it you will never know. You will get better at writing proposals within time and move up the ranks, built your feedback and meet new clients- get new leads.

    ——

    What do you most of you do to find new clients? Word of mouth? or local advertising?

  20. says

    Great post, but i think all what you say will happen for many other fields, i am a developer and i always thinking that after few years everything will be virtual , technology companies, employees, customers.
    And it will be something rare to see a company with employees in one place.

  21. says

    I think this is a no-brainer, especially with all the downsizing going on right now. Companies are going to find out (maybe) that they save money hiring freelance contractors. No bennies to pay. I think the economy is going to improve – sooner than the doomsayers think – but a lot of companies are going to find out they’re getting along without all the employees they thought were indispensable.

    The climate is ripe for freelancers. I bet it’ll stay that way.

    And of course newbies (I’ve been there) are going to make mistakes and have to learn more efficient ways to do business. That’s part of the learning curve, and yes it can be painful or embarrassing or expensive – but we learn.

    As for wanting to work with other creative minds – yes, if you work alone that can be a real drawback. Maybe “freelance cooperatives” or shared studios will grow, too. You want to work for yourself, but you want more professional, creative input too? Share your workspace with another freelancer! There are already artists’ cooperatives – why not freelancer cooperatives?

  22. says

    Great article and I hope you are correct.

    I am 36 years old, so I guess that makes me old, since the average freelancers are 25 – 34. :p

    I am currently heading down the freelance web design and development path, since I was laid off from my job about four weeks ago where I worked for 13 years. 10 of those years I was a web designer and developer and before that I worked doing PC support, desktop and server configurations, and other hardware and software related things.

    Having a degree in computer science and the 10 years of experience makes me feel that I can be successful as a freelance, but I am currently trying to find the clients I need to survive. If it all works out then I will be one of those freelancer that you talk about that will be the norm in 20 years.

    I have wanted to start freelancing for at least a year now and being laid off has given me the opportunity to try it. I just hope the industry has room for just one more freelancer to make a good living, so I can pay for our house, car, and my son’s preschool tuition.

  23. says

    I have to agree because I just started my company in March 2009!

    After moving (wife got a job she couldn’t turn down out of state) the economy exploded and I had no job opportunities, no one was hiring. So I decided, “why not hire myself?” So far (once you get past the weird loneliness at the beginning) I’ve already picked up a few clients, one global one, and I’m already loving the freedom to work when and how I want.

    I also agree this is not for everyone! Not knowing where the money is going to come from, being the sole contact, administrator, accountant (for now) and designer for clients is a very taxing job. The upside of course is that you don’t have to work 20hrs of unpaid overtime (unless you choose to), 2hr commutes in rush hour traffic, fear of losing your job, hours of meetings to meet about meetings or deal with a boss you hate. I can definitely see more young designers opting for this route in the foreseeable future.

    Can you tell I worked in a corporate environment for 8 years?

    Long live Freelancing!

  24. says

    Sorry mate but I have to side with @John Instruct this one.

    I do agree that there is a growing demand for freelancers but I also believe that after a while the market would reach equilibrium. I think your prediction will be correct but not to the extent you outlined in your article.

    Even if the freelancer has an excellent portfolio with a brilliant reputation they will still be competing against agency’s with the same. Given a choice between one person collaborating with other across the globe and an in house team of designers and developers I believe that big business people will in fact always choose the latter.

    I think we will defiantly see a rise in demand for freelancers and the market will respond but I see those freelancers still catering more to business start ups recovering from recession and medium sized established business as opposed to big business.

  25. says

    Ya, it is possible.
    But there are some regions like mine where the people are completely unknown about freelancing & the opportunities.

    Within a week or two I am posting an article about freelancing in the local newspaper. Hope the new ones who have lost there jobs will get out of the job tension and will move towards freelancing..

  26. says

    Actually, this is not the first time I’ve heard this. Work is becoming portable. They can lay you off and take your job from you, but they can’t take your skills. Even in “48 Days To The Work You Love” by Dan Miller, he talks about this trend in the workplace.

  27. says

    I, for one, love living a lifestyle where I can make my own hours, make plenty of money doing what I love to do, and still have time to take a handful of online classes (subject: whatever I want) on the side. Overhead? We don’t need no stinking overhead.

  28. says

    Great Input from everyone.

    I still have not heard from anyone the following?

    What is your best strategy to finding new Client?

    Besides a great portfolio etc etc.

  29. says

    I’ve been contracting and freelancing for 16 years. Here’s my beef. (1) Some young’uns don’t know how to price their services so that they can pay their bills and it drives the cost of my services down (2) folks call themselves “developers” when they couldn’t develop a good case of acne with hormones and chocolate and (3) “good money” to me is the middle six figures (which I happily earn). What you will not easily figure out is how to spend 50% of your time making sales and 50% of your time doing the work and still make 100% money. The other thing you will not easily figure out is that age and experience is reassuring to the big fish. Good luck to all.

  30. says

    I’d say 1 is 100% right, 2 is probably not going to be true. Being a little older then the group in 3 I can’t say for certain, but I think the importance of this is being overblown because of the times we are in right now. In a year I think most people will have forgotten about this.

  31. says

    @MadMac

    I completely agree with Point 1)

    Don’t sell yourself for speculative work, don’t under price your services, it cheapens the work for everyone.
    Having the same issue on some freelance sites, everyone has an good bid, and here comes along someone with a minimum $50 bid and takes it.

    Obviously is not the client you wanted, He is looking for price over substance, Most of the time they will get what they pay for.

    So if you are placing proposals on freelance sites, Dont sell yourself cheap. You are damaging the business for everyone.

  32. says

    An interesting article that made me think quite a bit about my own experience. I left school 7+ years ago and hadn’t considered freelancing full-time, since I’ve been laid off, let go from another job I wasn’t the right fit for and now work for a small company that is feeling the pressure of the economy. At times like these, full-time freelance work seems like a pretty tempting option. What I did learn from working for myself for over a year and a half is that it can be terribly lonely at times and I also worried about money when things would slow down. The independence is absolutely wonderful, but there are some downsides to consider as well.

  33. Raj says

    The reasons you have cited are not very convincing to prove why most designres a decade or two from now will be independent freelancers.

  34. says

    Hi Mason, thank you for this post. It really is enlightening. As a designer, one question I do have is where does one begin in establishing a freelance business? As in being legitimate, and getting all the taxes squared away with IRS. Also I have always wondered how does an individual go about carrying out there business paying taxes, medicare, and all the legal things. I would like to start a business, but not sure where to begin. Thanks!

  35. says

    Aman, I recommend finding a CPA that specializes in working with freelancers. When I was freelancing fulltime my CPA was a huge help with figuring everything out. A CPA can help you figure out estimated taxe payments, give you a rundown on what’s deductible and to what percent. Also, a credit union or bank can help you setup a small business account to separate your business money from personal accounts. Lastly, if you live in the US you can setup your business a few different ways, through your social security number or you can be an LLC or incorporated company. I know there are a few pros and cons to each approach and that was one area I needed quite a bit of guidance in. Best of luck!

  36. says

    Why Most Designers Will Be Freelancers Within 20 Years | FreelanceFolder I was suggested this blog by my cousin. I am not sure whether this post is written by him as no one else know such detailed about my difficulty. You’re wonderful! Thanks! your article about Why Most Designers Will Be Freelancers Within 20 Years | FreelanceFolderBest Regards Lisa

  37. says

    The costs of big design houses are ridiculous, especially given what they pay designers! I have noticed a recent trend for some designers that have gone freelance to search out full time employment again though… although usually in very cool places (as they have proved they are good enough to get those jobs I guess).

  38. says

    The most difficult part in freelancing is getting a steady flow of clients. Just look on Craigslist and you’ll see people offering web design for as low as $99. The majority of people looking for web design are very unaware of what sets apart good designers from bad designers.

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