Freelancing in America: A National Survey of the New Workforce

2. Research methodology • An online survey of 5,052 US adults who have done paid work in the past 12 Intelligent 2 © Copyright 2014 Daniel J Edelman Inc. Engagement months • Data collected July 19 - July 31, 2014 by independent research firm Edelman Berland • Results are weighted to ensure demographic representation in line with the United States Bureau of Labor Statistics 2013 Labor Force Statistics from the Current Population Survey • Overall margin of error of ±1.38% at the 95% level of confidence NON-FREELANCERS Definition: - Individuals who earned income through work but have not engaged in supplemental, temporary, project- or contract-based work, within the past 12 months. Sample n=3,332 FREELANCERS Definition: - Individuals who have engaged in supplemental, temporary, project- or contract-based work, within the past 12 months. Sample n=1,720

3. Study objectives Freelancers Union and Elance-oDesk commissioned Edelman Berland, an independent research firm, to conduct a study of the freelance workforce within the US with the following objectives: Intelligent 3 © Copyright 2014 Daniel J Edelman Inc. Engagement 1. Quantify the number of people freelancing in the US and their economic impact 2. Assess the state of freelancing, especially current demand for freelance services 3. Gather insights into drivers and barriers impacting freelancing 4. Gauge the outlook for freelancing, especially among millennials as they become the majority of our workforce This results deck is organized in sections to detail results on each of these objectives.

4. Key findings (by objective) 1. Freelancing quantified • There are 53 million people doing freelance work in the US – 34% Intelligent 4 © Copyright 2014 Daniel J Edelman Inc. Engagement of our national workforce • People who freelance contribute an estimated $715 billion in freelance earnings to our economy. 2. The state of freelancing • Freelancers see growing demand. Twice as many have seen an increase in demand in the past year as have seen a decrease (32% experienced an increase versus 15% who have seen a decrease).

5. Intelligent Key findings (cont.) 5 © Copyright 2014 Daniel J Edelman Inc. Engagement 3. Insights into barriers and drivers • 80% of non-freelancers say they would be willing to do work outside their primary job to make more money. • Earning extra money (but not financial necessity) and schedule flexibility are the top drivers of freelancing. • Finding work and, correspondingly, income stability are the top barriers to doing more freelancing work. • 69% of freelancers said technology has made it easier to find freelance work. 4. The outlook for freelancing • 77% of freelancers say the best days are yet ahead for freelancing and 65% said freelancing as a career path is more respected today than it was three years ago. • Millennials are freelancing more than any other age group. Over a third (38%) of Millennials are freelancers. They’re also most optimistic about freelancing – 82% say that the best days of freelancing are yet ahead. • 36% of moonlighters who have a primary job have thought about quitting to work completely independently – this represents 5.1 million people.

7. There are 53 million people freelancing in the U.S. • Our survey of over 5,000 U.S. workforce members rigorously screened respondents to determine the percent who earned freelance income in the past year. Results showed that 34% of the U.S. workforce is doing freelance activity. civilian labor force at 156 million, we estimate that the U.S. workforce currently includes 53 million people who are freelancing. • A 2006 study by the U.S. Government Accountability Office found there were 42.6 million “contingent workers” – for nearly a decade that was the best guess we’ve had. • These freelancers contribute an estimated $715 billion annually in Intelligent • Based on the Bureau of Labor Statistics July 2014 estimate of the 7 © Copyright 2014 Daniel J Edelman Inc. Engagement freelance earnings to our economy. http://www.bls.gov/news.release/pdf/empsit.pdf

8. Intelligent Freelance Business Owners 5% 10% 2.8M Temporary Workers 5.5M 8 © Copyright 2014 Daniel J Edelman Inc. Engagement The freelance workforce: 5 freelancer segments 40% 27% 18% Independent Contractors Moonlighters Diversified Workers 21.1M 14.3M 9.3M

9. How did we quantify freelancers? Starting with the general U.S. workforce, each respondent ran through a series of questions that carefully qualified their employment status and income in order to detect freelancing that might otherwise go unrecorded. The following definitions and examples explain 5 segments of freelancers captured: Intelligent 9 © Copyright 2014 Daniel J Edelman Inc. Engagement 1. Independent Contractors (40% of the independent workforce / 21.1 million professionals) – These “traditional” freelancers don't have an employer and instead do freelance, temporary, or supplemental work on a project-to-project basis. 2. Moonlighters (27% / 14.3 million) - Professionals with a primary, traditional job who also moonlight doing freelance work. For example, a corporate-employed web developer who does projects for non-profits in the evening. 3. Diversified Workers (18% / 9.3 million) – People with multiple sources of income from a mix of traditional employers and freelance work. For example, someone who works the front desk at a dentist’s office 20 hours a week and fills out the rest of his income driving for Uber and doing freelance writing.

10. How did we quantify freelancers? (cont.) 4. Temporary Workers (10% / 5.5 million) - Individuals with a single employer, client, job, or contract project where their employment status is temporary. For example, a business strategy consultant working for one startup client on a contract basis for a months-long project. 5. Freelance Business Owners (5% / 2.8 million) – These freelancers have between one and five employees, and consider themselves both a freelancer and a business owner. For example, a social marketing guru who hires a team of other social marketers to build a small agency, but still identifies as a freelancer. Intelligent In order to qualify, freelancers had to have earned freelance income within the past 12 months. 10 © Copyright 2014 Daniel J Edelman Inc. Engagement The following slide demonstrates how freelancers were screened through the survey questionnaire.

13. Nearly one-third of freelancers report increased demand for their services in the past year Intelligent In the past year, have you seen the demand for your 32% freelance services change? 53% 15% Increased Demand No Change 13 © Copyright 2014 Daniel J Edelman Inc. Engagement Q44. In the past year, have you seen the demand for your freelance services change? n = 1,720

14. Education matters: Tech education, college, and post-grad degrees see greater demand than freelancers with only high school or some college Intelligent How much demand is there for your freelance services? 25% 19% (by educational attainment) 15% 2% 4% 2% 3% 14 © Copyright 2014 Daniel J Edelman Inc. Engagement Q43. How much demand is there for your freelance services? n = 1,720 20% 12% 56% 59% 60% 57% 64% 17% 18% 25% 21% 22% Some High School or Less High School Graduate Vocational or Technical College Graduated College Post-Graduate Degree Demand Education None Very Little

15. Experience matters: More experienced freelancers see the greatest demand How much demand is there for your freelance services? (by length of experience as a freelancer) 8% 5% 1% 1% 3% 5% Intelligent 15 © Copyright 2014 Daniel J Edelman Inc. Engagement Q43. How much demand is there for your freelance services? n = 1,720 22% 18% 19% 23% 13% 21% 19% 20% 50% 60% 64% 57% 72% 58% 55% 47% 21% 18% 17% 20% 14% 19% 26% 28% <6 months 6 months - 1 year 1-2 years 2-3 years 3-4 years 5-10 years 10-20 years 20+ years Demand Experience None Very Little

16. The STEM skills gap shows: Freelancers in STEM fields see greater demand than other industries How much demand is there for your freelance services? (freelancers by industry) 2% 3% Intelligent 16 © Copyright 2014 Daniel J Edelman Inc. Engagement 13% 19% 18% 20% 57% 50% 46% 60% 58% 41% 37% 35% 23% 19% Computing, computing peripherals or other IT manufacturer Data science and analytics Mobile and web programming Technology Other industries Demand Industry None Very little Q6. Please select the industry in which you currently work. n = 1,720 Q43. How much demand is there for your freelance services? n = 1,720

17. Freelancers provide difficult-to-find skills Intelligent Select the option that best describes your views on how the perception of freelancing as a career has changed compared to 3 65% years ago 7% 28% Freelancers offer skills that might be difficult to find traditionally Neither/Balanced Freelancers rarely offer anything that couldn't be hired for traditionally 17 © Copyright 2014 Daniel J Edelman Inc. Engagement Q57. For each of the statements below, select the option that best describes your views on how the perception of freelancing as a career has changed compared to 3 years ago. n = 1,720

19. Intelligent Would you be willing to do additional work outside of your primary job if it was available and enabled you to make 19 © Copyright 2014 Daniel J Edelman Inc. Engagement Most non-freelancers are open to freelancing Yes 80% No 20% more money? (Non-Freelancers) Q21. Would you be willing to do additional work outside your primary job(s) if it was available and enabled you to make more money? n = 3,332

20. More than half of freelancers began freelancing by choice, not necessity “I had the degree and loved the work. Held down one career while building this one. Retired from first career and now, after 39 years, I only want to freelance part time and I do not know when I will give it up.” “I am very passionate about what I do, but I have a large family. This allows me to be both a stay home parent and have a small career. I like what I do, and I want to do it my way is another big reason.” “I am learning more effectively how to make money by several different sources so if one source slows down, I can rely on other sources instead of just an employment income.” “I don't have to worry about losing my job. I don't have bosses dangling pink slips over my face and constantly threatening to fire me.” “I put myself through college, investing on my own, so having enough money to live on was not a huge factor, so after a few years I decided that pursuing a writing career was a 'now or never' venture, and I've been doing it ever since.” Intelligent Which is closer to the reason you originally started freelancing? 20 © Copyright 2014 Daniel J Edelman Inc. Engagement Choice 53% Necessity 47% Q48. Which is closer to the reason you originally started freelancing? n = 1,720 Q51. Please explain why you choose to freelance. n=868

21. Earning extra money is the primary reason for freelancing, but schedule flexibility is also a top motivator Intelligent 21 © Copyright 2014 Daniel J Edelman Inc. Engagement Q34. What are your personal motivations for freelancing? Please select all that apply. n = 1,720 68% 42% 37% 33% 31% 30% 30% 29% 27% 22% To earn extra money To have flexibility in my schedule Out of financial necessity Ability to choose my own projects To be in control of my own financial future To be able to pursue work I am passionate about To gain additional skills or experience To be able to spend more time with friends and family To have independence from things such as office dynamics To expand my professional network Top 10 Personal Motivations for Freelancing

22. Fair compensation is important to all, but freelancers place greater importance on controlling their destiny, interesting work and flexibility, and less importance on high pay Intelligent 22 © Copyright 2014 Daniel J Edelman Inc. Engagement Q22. How important to you are each of the following work characteristics. n = 5,052 78% 73% 67% 66% 65% 64% 64% 63% 59% 53% 81% 68% 64% 61% 57% 64% 71% 57% 55% 52% Provides the pay appropriate for my skill-level Allows control of my own destiny Opportunities to learn new things (challenging) Ability to work on interesting projects Flexibility to work when I want Low stress Provides high pay Flexibility to work where I want Ability to have a positive impact on the world (fulfilling) Is exciting Importance of Work Characteristics (Freelancers vs Non-Freelancers – Very/Extremely Important) Freelancers

23. Finding work and income stability are the biggest barriers to freelancing more 50% 47% Intelligent Top Barriers to Freelancing More (Self-Identified Part-Time Freelancers and Moonlighters) 23 © Copyright 2014 Daniel J Edelman Inc. Engagement 31% 23% 21% 13% 9% 2% More stable income from freelancing Easier to find freelance work A more reliable way to ensure you receive the pay you're due Knowing which skills are in demand (so that you can offer them) Better availability of affordable benefits Less administrative work required (help with taxes, timekeeping, compliance,… None Other Q32. Which of the following factors would lead you to do more freelancing work? Please select up to three. n=1,344

24. But technology is making it easier to find work “The world is a big place. The internet has made the world flat, essentially. There are billions of people on this planet with access to everything by everyone. If you create something that no one else creates, or you create it in a manner better than others, you will succeed.” “There are more avenues available to find work, to make contacts, to connect with others, etc. thanks to technology and its Intelligent 69% Agree that technology has made it easier to find freelance work 24 © Copyright 2014 Daniel J Edelman Inc. Engagement ability to network.” “With the advent of the internet and social networks, you can contact and learn about other companies and people faster than ever before.” “10 years ago I would not as easily have gotten business from clients across the country let alone across the world.” Q53_5. What do you think is different about the freelance job market today compared to 3 years ago? Please indicate your level of agreement with the following statements: Technology has made it easier to find freelance work

25. More than two-thirds of freelancers also said social networking is changing the dynamics of networking Intelligent What do you think is different about the freelance job market today compared 25 © Copyright 2014 Daniel J Edelman Inc. Engagement 69% 23% 8% to 3 years ago? (Agree/Disagree - Social media is drastically changing the dynamics of networking) Agree Neither Agree nor Disagree Disagree Q53. What do you think is different about the freelance job market today compared to 3 years ago? n = 1,720

26. Two in five freelancers have worked online Intelligent Have you done a freelance project online – meaning work that you found and performed via the Internet? No 58% Yes 42% 26 © Copyright 2014 Daniel J Edelman Inc. Engagement Q59. Have you done a freelance project online – meaning work that you found and performed via the Internet? n = 1,720

27. One in four find projects online in 24 hours; more than half (57%) find projects online in 3 days Intelligent 31% How long on average does it take you to find freelance projects that 26% you look for online? 18% 11% 5% Less than 24 hours 1-3 days 4-6 days 1-2 weeks 3-4 weeks 27 © Copyright 2014 Daniel J Edelman Inc. Engagement Q59. Have you done a freelance project online – meaning work that you found and performed via the Internet? n = 1,720 Q60. How long on average does it take you to find freelance projects that you look for online? (i.e. between looking for an opportunity and starting work of it) n = 714

29. The majority of freelancers feel that respect has grown for freelancing as a career choice Intelligent Select the option that best describes your views on how the perception of freelancing as a career has changed compared to 3 65% years ago 7% 28% Freelancing as a career path is more respected today Neither/Balanced Freelancing as a career path is less respected today 29 © Copyright 2014 Daniel J Edelman Inc. Engagement Q57. Select the option that best describes your views on how the perception of freelancing as a career has changed compared to 3 years ago. n = 1,720

30. More than one-third of freelancers expect to increase the amount of time they spend freelancing in the coming year Intelligent 97% freelancers who consider In the coming year, how do you expect the total number of hours you spend freelancing in a typical week to change? 30 © Copyright 2014 Daniel J Edelman Inc. Engagement the increase in hours a good thing Q45. In the coming year, how do you expect the total number of hours you spend freelancing in a typical week to change? n = 1,720 Q25. How many hours in a typical week do you do freelance work? n = 1,720 38% 50% 12% Increase Stay the same Decrease

31. Additionally, nearly half expect their income from freelancing to increase in the coming year Intelligent In the coming year, how do you expect your income from freelancing to 43% change? 46% 31 © Copyright 2014 Daniel J Edelman Inc. Engagement Q42. In the coming year, how do you expect your income from freelancing to change? n = 1,720 11% Increase Stay the same Decrease

32. Most of us at traditional jobs probably have coworkers who are moonlighting… Intelligent 32 © Copyright 2014 Daniel J Edelman Inc. Engagement 16% Of all workers with a primary employer have done work outside of their main job in the past year to earn additional money 14.3M Moonlighters Q11. Do you have an employer (i.e. company you work for)? If you are self-employed or freelance for clients, please select no. n= 5,052 Q12. Do you have more than one employer, job, or contract project? n = 3,492 Q13. Do you do any work outside of your primary position to supplement your income or earn additional money? n=2,898

33. 5.1M Potential New Independent Contractors Intelligent One-third of moonlighters considered quitting their job – that would be 5.1M new independent professionals Yes 36% No 64% Have you considered quitting your job in order to work completely independently? Somewhat/ Very Likely 33% Not Very/Not at All Likely 67% How likely are you to quit your primary job in the next two years in order to work entirely independently? 33 © Copyright 2014 Daniel J Edelman Inc. Engagement Q37. Have you ever considered quitting your primary job in order to work completely independently? n = 464 Q40. How likely are you to quit your primary job in the next two years in order to work entirely independently? n = 464

34. Intelligent More millennials freelance than any other age group 62% Freelance Participation by Age 34 © Copyright 2014 Daniel J Edelman Inc. Engagement Q2. What is your current age? n = 5,052 66% 69% 68% 38% 34% 31% 32% 18-34 35-44 45-54 55+ Non-Freelancers

35. Additionally, millennials are looking for fulfilling and exciting work more so than other generations Intelligent 35 © Copyright 2014 Daniel J Edelman Inc. Engagement Q22. How important to you are each of the following work characteristics. n = 5,052 80% 71% 69% 69% 64% 62% 62% 62% 59% 59% 80% 67% 69% 64% 62% 65% 54% 47% 60% 58% Provides the pay appropriate for my skill-level Provides high pay Allows control of my own destiny Opportunities to learn new things (challenging) Ability to work on interesting projects Low stress Ability to have a positive impact on the world (fulfilling) Is exciting Flexibility to work when I want Flexibility to work where I want Importance of Work Characteristics (Millennials vs Adults 35+– Very/Extremely Important) Adults 18-34 Adults 35+

36. And millennials are most optimistic about the future of the freelance job market Intelligent How do you see the future of the freelancing job market? 82% (Millennials vs Adults 35+) 36 © Copyright 2014 Daniel J Edelman Inc. Engagement Q56. How do you see the future of the freelancing job market? n = 1,720 18% 74% 26% Best days are ahead Best days are behind Adults 18-34 Adults 35+

38. Intelligent This study commissioned by: 38 © Copyright 2014 Daniel J Edelman Inc. Engagement Freelancers Union Freelancers Union’s 250,000 members believe all workers should have the freedom to build meaningful, connected, and independent lives – backed by a system of mutual and public support. More than one in three working Americans is an independent worker. That's 53 million people – and growing. They are lawyers and nannies, graphic designers and temps. Freelancers Union serves the needs of this growing independent sector. Elance-oDesk Elance-oDesk is the world’s largest online workplace. More than 2.5 million businesses and 8 million freelancers tap into www.Elance.com and www.oDesk.com to work together via the Internet. As our increasingly connected and independent workforce goes online, talent—like software, shopping and communications before it—is shifting to the cloud. This shift is freeing professionals from set-time-and-place work, while also making it faster and easier for businesses to hire. Elance-oDesk is headquartered in Mountain View, California, with offices in San Francisco, California, and Oslo, Norway. For more details, go to https://www.freelancersunion.org/53Million