By Craig Erwin, Ph.D.
Many Americans decided to leave their jobs and work for themselves during the pandemic. Many others had no choice but to freelance after losing their jobs. As a result, the number of unincorporated self-employed people in the USA is about 10 million and it reached 10.3 million last summer.
The past year probably seemed like a good time to resign and start freelancing, especially as Covid began to wane and the job market bounced back with a vengeance. People probably figured that, if their freelance dream fell through, they could always find another job with a steady paycheck, given how robust the job market was. Covid relief funds provided a cushion to fall back on, too.
Freelancing comes with attractive perks, including getting rid of your boss, gaining freedom, being able to work from anywhere in the world, not having to commute, and cutting expenses on work clothes.
In spite of the perks of freelancing, living without a regular paycheck can be scary. What if it doesn’t work out? What if you can’t earn enough to make ends meet or save for retirement?
In our society, Gig workers fall through the cracks. Working for yourself makes some things much harder or more expensive than if you work for a corporation. Just like part-timers, freelance workers miss out on the benefits that full-time employees of large businesses typically get, such as retirement savings plans with a match; life, medical, and dental insurance; flexible spending accounts; paid vacation and sick time; paid holidays; expense reports; and paid medical leave.
One more thing; good luck buying a house without a steady paycheck. At the rate house prices are rising, it’s awfully hard to buy a house even if you have a steady paycheck, but if you freelance, real estate professionals probably won’t give you the time of day. They want evidence of reliable income.
Are you dreaming of freelancing? If so, what would prompt you to leave your job? Are you self-employed? If so, do you believe the pros of freelancing outweigh the cons?
For more information on the Gig economy, freelancing, the economy, or Covid-19, click on the following links: