Freshbooks, the #1 accounting software in the cloud designed exclusively for service-based small business owners and independent professionals, recently released their “Self-Employment in America 2019” report.
Solo PR Pro had the opportunity to chat with Matt Baker, VP of Strategic Planning at FreshBooks about the report and discuss some of the findings. Different than typical reports, Freshbooks was not only interested in the numbers of people that are self-employed but the motivations and behaviors. The report left is optimistic and affirms what many solos feel and experience. Read on for Matt's answers to some of the questions we posed about self-employment.
Why Study the Self-Employed?
This is our third year of doing this type of annual review. We believed that there was some data being collected, but largely it was a very misunderstood segment of the market that we serve. We felt that we should be able to shine a light on this market and help understand it. More than just looking at the size of the market, we wanted to find out, what is the mindset, what are the challenges, rewards and why people are really in this space.
What surprised you most about this year’s report?
I was surprised to see that despite the intention of people to switch from a traditional job to self-employment, many people did not do it. Last year we saw lots of people raising their hand and saying, I intend to make this switch. And this year when we pulled the data, we saw that, very few actually did. Now, when I really step back from it, did I really expect the whole US economy to change? Probably not, but I do believe there's a real mindset shift to people not wanting to climb the traditional corporate ladder but pick up their own ladder in a different kind of way, in a learning and exploration journey.”
Last year 27 million American workers said they were considering a shift to self-employment by 2020. However, it is estimated that fewer than 2 million Americans took the leap full-time in 2018.Source: Freshbooks
The other thing that surprises me every time because it's consistently so high is the percentage of people that have no interest in going back. It is so interesting that there's all of that hesitancy in the barriers to getting there, but for the folks who have made it there, there's no going back.
96 percent of the self-employed have no desire to return to a ‘regular job’.Source: Freshbooks
Why people choose self-employment
When I talk to anyone and try to frame the advantage of being self-employed as a hard thing, often the answer is not dollars and cents, at the end of the day, or something very specific, such as part of a safety net like health that they get or don't get. I think some people make the leap because they see some financial upside. But to me, it's more of the mindset, they have this feeling of “I want to be independent, I want to have the flexibility, I want to feel more fulfillment.” By having control over their career that gives them the purpose that they're looking for that does not exist in the corporate sort of lifestyle.
What can the self-employed do to prepare for 2020?
The most obvious one that comes to mind, is this concept of being able to get your own client. I think that's the biggest opportunity for this segment of the workforce to be able to stay self employed sustainably. There are platforms that exist that help you get started, not just Uber, DoorDash, and the like but things like Upwork or Fiverr or, Thumbtack for instance. But the challenge in almost all of those platforms is that they play a significant role in pricing and transacting the work. But they don’t equip you to build and sustain long term, because they don't give you the ability, and the understanding of how to find clients, and how to price. I would suggest to people to find a way that you can get your own clients, and then you can build your own ability to price and create value.
83% chose their own destinies as self-employed professionals. That choice is empowering and they embrace it, full-on.Source: Freshbooks
It keeps getting better.
We've shown statistically, that your satisfaction in self employment over your career goes goes up. Whereas your satisfaction in traditional employment tends to go down over time. Generally, building your own business versus doing the work that somebody defined for you, in a lot of ways, it's harder out of the gate, so satisfaction is actually lower for self-employment as you get started. But then, over time, it actually goes up and surpasses traditional employment. It's a long game, and if you can invest in it, you can do it long term. As you can imagine, it's probably based a lot on the feeling that “Hey, I built this business, for better or worse, I did this myself,” and that's a pretty rewarding thing.
You can review the entire Self Employment in America 2019 report here.
Have you taken the leap yet? How does this compare to your experience? Let us know in the comments on social media using #solopr.
Matt Baker is a money strategist and business coach who’s passionate about helping entrepreneurs solve problems and get things done. He’s also the VP of Strategic Planning at FreshBooks, the world’s #1 cloud accounting software for self-employed people.
A reformed management consultant and ex-Google employee, Matt loves asking questions about anything and everything relating to business strategies. When he’s not studying a business’ fundamentals, Matt is diving into his latest sci-fi page-turner, biking, or spending time with his family at home in Oakland, California.