Power in Numbers: A Look at Freelancing and Small Business in America


As of February 2018, there were more than 126 million full-time jobs up for grabs in America, with employment growth in the fields of “construction, retail trade, professional and business services, manufacturing, financial activities, and mining.” Yet, while Wall Street rejoiced at these numbers, since they wouldn’t trigger an increase in interest rates by the Fed, workers, on the other hand, still have plenty of anxiety in regards to future opportunities. 

In a 2017 study by McKinsey & Company, it was revealed that more than half of the U.S. workforce is concerned that the job they’re doing right now won’t even exist in 20 years due to computers and automation. These fears are not unfounded, being that those very same technologies are predicted to affect over 60% of occupations.

Worse case scenario, two-thirds of all jobs existing today - or some 80 million positions - could be completely taken over by automation in the coming years. Then again, the least safe jobs, according to a 2013 study by Oxford University, included those of the telemarketer, loan officer, cashier, legal assistant, and taxi driver...but only time will tell. 

Stability, it appears, is being redefined, and Millennials are on the forefront of this shift.

Many have become disillusioned by the paths carved out by their parents and grandparents, in which you get a degree, land a job, set up your desk, and stay put until retirement. It’s not that they don’t crave that kind of constant order and steadiness - they just know it’s no longer guaranteed.

A company can go under due to poor management today, leaving workers out on their asses tomorrow - with no warning and less than $1,000 in savings. A new technology can be brought to market, and an otherwise dependable job can be gone within the week. And automation, artificial intelligence, and computing power have made those who are best at waiting their turn, asking for instructions, and filling in their Scantron bubbles perfectly with a #2 pencil the least likely to succeed. 

So what is success or stability these days?

For many, it means independence outside of the traditional corporate employment system, either by starting a small business or choosing to work as a freelancer. These are individuals who value a diversified portfolio of clients over a secure employer, as well as the ability to be their own boss, set their own schedule, and choose the projects they work on along with when and where.

As of 2017, over 57 million Americans called themselves freelancers, and it’s estimated that by 2027, that number will exceed 86 million workers. Currently, they represent nearly 40% of the total U.S. workforce, and their numbers are only going to grow. 

Ironically, this growth is due to the very same technological advances that threaten those employed by cubicle nation: telecommuting, automation, crowdsourcing, and the power of mobile devices. And, having been raised during the dawn of the Internet Age, Millennials have been able to leverage these technologies to their advantage, with more than a third of the generation already being employed as independent workers. And in the past year, freelancers contributed over $1.4 trillion to the economy - a 30% increase from the year before.

However, might there be even more freelancers working in America today than is initially assumed? 

According to the Small Business Administration (SBA), a small business is defined as having anywhere from 10 to 500 employees. However, in 2014, there were 29.6 million small businesses, representing 99.9% of all firms. And, only 20% of these firms had employees, which means the vast majority of these small businesses not only had fewer than 10 employees, but were actually a business of one.

Moreover, over 60% of all firms without paid employees are actually home-based operations. So, in a sense, even if these businesses were set up as an LLC or sole proprietorship, they appear to be more freelance-oriented. After all, if you don’t hire anyone, are you really a corporation, or are you a freelancer with fancier paperwork? Or is a sole proprietor (86.4% of small businesses) just a freelancer in disguise? Using these metrics, you could perhaps argue that freelancers then make up 80% of the entire U.S. workforce. But is this a good thing? 

It appears that, due to the availability of powerful technology, the future will not be one of tedious tasks and blind repetition, but one of imagination and creativity. As Richard Florida, an urban studies theorist, once pointed out, “human creativity is the ultimate economic resource.”

And, sadly, corporations are not the producers of creative thought, more often than not. Instead, that is the realm of an independent creative class, who is eager is learn, try things that might not work, and fail forward in the pursuit of a complex idea. And unlike the majority of employees working in a traditional setting, over 55% of freelancers have been enrolled in skill-related continued education in the last six months.

Because of the constantly shifting sands that online businesses have been built upon (thanks to the perpetually changing digital landscape), these professionals are more attuned to taking risks and testing ideas that might fail - a skill-set that is sadly underdeveloped in America due to the nature of our education system as well as the expectations of corporate America. As a result, these individuals, in their pursuit of freedom and personal stability, have also made themselves more resilient in the face of an ever-changing world. 

Finally, with more employees moving out of their cubicles and into their home offices as solo entrepreneurs, a sense of community and connection has also begun to grow. Today, you can connect with anyone on the planet with Internet access, and also nurture relationships with fellow small business owners and freelancers within your own town, city, or neighborhood.

There are meetups, incubators, farmer’s markets, local events, coworking spaces and venues - all vying for attention against corporate behemoths such as Google and Amazon. But as the workforce becomes more decentralized, perhaps those very same individuals who are choosing themselves over the traditional bottom line will also help the smaller options flourish.

And by giving power back to our local communities and building relationships with fellow freelancers, we can all win - not as independent individuals but as a powerful network of humans who love what they do.