May 9, 2018

Specialized independent workers may be in direct sales. Or, they can be creative arts performers, such as voiceover artists; technical service providers, such as programmers, and professional service providers, such as attorneys and tax accountants.

For businesses small and large, freelancers can fill skills gaps where an organization falls short without requiring a company to hire additional full-time employees. These workers are unlikely to be displaced by job automation due to the creative and specialized service-oriented nature of what they do.

There was a time when freelancing was a contingency plan, the way that people made ends meet when they couldn’t get a “real” job or had other obligations to work around. Today, the freelance lifestyle has become a mainstream choice, and it doesn’t seem to be going away anytime soon.

Across the 15 top U.S. cities for independent workers, an analysis of U.S. Census Bureau data by Fiverr and Rockbridge Associates points to more than $110 billion in projected 2017 tax year revenue for specialized independent workers — i.e., freelancers — comprising a solid 1 percent to 2 percent of the GDP in those cities.

Brent Messenger, global head of community at Fiverr, told PYMNTS that as freelancing becomes a way of life for so many, it’s time workers get access to the tools they need to manage a freelance lifestyle and budget as well as to grow their freelance career — and it’s time for cities to make themselves more welcoming to this type of worker.

Cities To Watch

The growth of freelance populations is closely tied to infrastructure and cost of living, said Messenger. Areas that have a lower cost of living and provide access to broadband tend to be attractive to freelance workers, and these are matters that cities should consider if they’re hoping to attract this population.

This correlation was revealed through Fiverr and Rockbridge’s recent analysis of the Census Bureau data. The partners looked at more than 20 million tax returns from the 15 cities studied.

For example, Houston may lag behind San Francisco and New York City in terms of what freelancers can earn, but the southern city has still proven attractive due to its cost of living and, yes, the availability of broadband.

Messenger said he was surprised to learn that Miami was the fastest-growing city for freelance workers. He said the rate of revenue growth is outpacing the number of people, meaning Miami could be about to explode onto the gig economy map.

The Digital Workforce Development Initiative

Four other cities may also be about to appear on that map: Kansas City, Memphis, Richmond and Stockton, California.

Fiverr has partnered with SamaSchool and Udemy as well as city officials to help make those locations more freelancer-friendly. The Digital Workforce Development Initiative (DWDI) pairs companies and communities to provide training and support for specialized independent workers.

Freelancers have incredible skills, said Messenger, but they generally lack the basic knowledge they need to thrive in a freelance context — and that’s only natural, since who is teaching people to become freelancers? Certainly not high schools and colleges.

Consequently, freelancing is still being treated as a Plan B — but with so many specialized independent workers now choosing it as Plan A, said Messenger, it’s time to provide more resources and education for those who are making that choice.

Prior to DWDI, Fiverr has offered freelancers on its marketplace platform a certain degree of protection in terms of getting paid for work completed. However, said Messenger, Fiverr is only a marketplace platform; it’s not its place to offer users the same benefits they would be offered by a formal employer — i.e., healthcare and automatic tax deductions.

Messenger said Fiverr has been working to do more for its users. Its Elevate platform creates access to tools for tax preparation, affordable healthcare access, time management, tracking and budgeting, as well as connecting freelancers to an offline community that can share support, ideas and best practices.

Now, with DWDI, Fiverr is working to spread those offerings more widely. SamaSchool’s role is to teach specialized independent workers how to become a freelancer and access gigs through the Fiverr marketplace, while Udemy will provide opportunities to increase their marketable skills, either by improving skills they already have or by learning new ones within their discipline.

“We’re creating an entire freelancer ecosystem,” Messenger said.

Inviting Freelancers In

Messenger said the four cities diving in with DWDI have recognized something he believes a lot of cities are going to realize in the near future: That is, that independent workers aren’t just benefiting themselves when they move to a city; rather they’re participating in the city’s economy and benefiting the entire community.

“Economic development people think they need to attract a company so they can get 200 people to boost the local economy,” Messenger said. “But 200 skilled independent workers will have the same effect. These four cities have decided, ‘Let’s keep that money here and see these people thrive. Let’s help them become some of the most successful entrepreneurs in our community.’”