Too often, organizations view freelancers as an optional extra, hired at short notice and filling narrow roles far removed from the strategic direction of the company. As a result, the growing pool of freelance talent remains underutilized and often poorly managed, just as freelancing has become a mainstream job for millions of people around the world.
Research from Harvard Business Review Analyst Services and Fiverr shows that freelancers do about 20% of the work in American companies. By 2027, freelancers are expected to outnumber the country’s full-time workforce. Similarly, a recent survey of UK businesses found that four in ten currently work with freelancers, with 60% saying that working with freelancers has helped employees tackle and prevent burnout by 2023.
Although the 2023 Harvard Business Review survey shows that 81% of respondents consider freelancers important to their organization, only 38% say their organization is very effective at managing them. 45% of companies surveyed do not have a comprehensive strategy for hiring freelancers. This is to the detriment of the company that wants to utilize outside talent. If employers want to respond to their growing talent base, they must better identify and utilize freelancers. This can be done in the following ways:
UK Country Manager at Fiverr.
Create a Chief Freelance Officer
One of the biggest challenges HR teams face is that they mainly focus on full-time employees, but in terms of freelancers, this responsibility usually falls to a specific team leader. This can result in ineffective recruitment and talent management within the company. When considering hiring freelancers, the top challenge in the survey, cited by 49% of respondents, was finding freelancers with the right skills. A dedicated Chief Freelance Officer who recruits and manages freelancers will be better equipped to find and optimize external talent. The “CFO” would also implement strategies to integrate freelancers into their workforce, championing their role within the C-Suite. This would get the most value out of a freelancer, align them with the strategic direction of their host organization, and better measure their performance.
Promoting processes and technology
Typically, companies need a software-on-demand SaaS solution that gives them control over their entire freelance workforce by allowing them to find, hire, hire, manage and pay freelancers, while ensuring compliance regulations are ensured to maximize business growth. And by using AI, organizations can monitor relationships with freelancers, including the validity of legal documents, allowing the Chief Freelance Officer to reduce the risk of worker misclassification.
Attract talent and ensure their success while measuring your ROI
Labor is often the largest expense for any company. Deloitte estimates that this represents between 50 and 70% of company expenditure. A cost-effective talent management strategy is crucial. The best talent management strategy will align business objectives with the talent’s capabilities and development goals. A Chief Freelance Officer will harmonize these requirements and identify the skills gaps that need to be addressed. When closing the skills gap, the CFO will often decide between expanding the talent pool or offering more flexible work. This will increasingly be the same, and HRs will need to consider all their employees as freelancers.
The future
Freelancing will become increasingly common in a dynamic job market characterized by remote work, economic uncertainty and the drive among younger professionals to supplement their income with multiple jobs and passion projects.
The popularity of the side hustle is especially evident among Generation Z, with platforms like TikTok making it possible to monetize such projects. A global Kantar survey of 10,000 employees from February 2023 shows that 40% of Gen Z employees combine at least two roles.
Caitlin Duffy, research director at Gartner, explains this generational bias: “Career paths are becoming less linear… young workers are entering a turbulent work environment: they want to set themselves up for long-term employability, remain flexible and be able to move between workplaces.”
This description could now be applied across generations, but Generation Z will grow the workforce. Therefore, freelancing will play a more central role in organizations, driven by newcomers to the labor market, established freelancers or those who became accustomed to greater autonomy and remote working after the pandemic. Everyone becomes a freelancer due to preference or market forces.
Still, regardless of the workforce mix, a poorly managed team will produce poor results. It’s time to redesign management structures to optimize the new workforce, whether new entrants to the workforce or established freelancers. There is much to look forward to in the new talent landscape and a dedicated Chief Freelance Officer would be ideally suited to maximize external expertise in the coming years.
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