Opinion: Across South Africa, the gig economy is booming

A weak job market and low youth employment is driving an upward trend in South Africa’s free-lance market that is set to continue in 2019, Colin Don Shouw predicts.

By 2020 freelancers in South Africa are expected to make up 50% full time work force. But why are more and more South Africans breaking away from the nine-to-five routine?

The reasons more people are going solo are two-fold. Firstly, as companies evolve with new technology and digitisation, there is a burgeoning demand for freelancers, bringing a wealth of opportunity with it.

If you’re considering taking the leap, but are wary of the risks, economists say there are many indicators that now is the right time.

Businesses now more than ever are looking to outsource work to remote independent workers rather than hiring in-house staff. But what is driving this shift?

Fair pay

Over the last few years, the average earnings of freelancers have increased by 50%. Not only are more people willing to hire freelancers, they are willing to pay them the right price for their work as well.

People who employ freelancers are starting to realize that cheaper is not always better. The logic is: you could do it on the cheap or you could do it well.

So what are the benefits to employers, as well as freelancers that has made this option so much more attractive?

Firstly free-lancers cut expensive employee overhead costs.

There is also flexibility in the length of contract, while it speeds up the time taken to find the right person for the job.

The reasons for the burgeoning popularity of hiring freelancers in South Africa came down to three things: speed of hiring, flexibility and cost.

This raises the question: Is work being taken away from in-house staff?

The fear that freelancers are taking work away from in-house staff appears to be largely unfounded. 

Further research from The Southern African Freelancers’ Association (SAFREA) shows a move towards a “hybrid model” within organisations.

This approach combines in-house staff who manage the everyday running of the office, with freelancers who are brought in for specific projects.

Businesses are finding that freelancers remotely and can be a lot more productive than those working onsite.

Employers are also moving towards hiring ‘generalists’ as in-house workers: people with flexible skills who can adapt to a variety of tasks.

Freelancers can also simply be brought in for a limited period to do niche work that requires a specialist skill set.

Growing free-lance economy

The Southern African Freelancers’ Association (SAFREA) released its first research report in 2016 on the local freelance economy, revealing the average age, gender, location, education, working hours, rates and income of freelancers in the country.

Dominating the free-lance market are Baby Boomers and Generation Xers, a finding that may reflect trends in the media industry such as downsizing and lay-offs. Nearly 80% of freelance media professionals are women.

This puts South Africa in line with international trends that indicate female freelancers dominate the media industry.

There is no doubt that freelancers are highly skilled, according to the report, with over 60% of freelancers holding postgraduate degrees.

Most free-lance employees (39%) have 20 or more years’ experience in their specialty field, which offers employers and clients a level of security.

My prediction is that with the weak job market and low youth employment in the country, we can expect to see an increase in freelance workers in 2019 and beyond.

To sustain that growth, fair standards and practices must flourish in the industry.

This is why joining freelance online platforms such as Jobvine, where contracts are regulated is so important.

These platforms provide resources, tools, training and networking to strengthen freelance careers. 

The Future of self-employment in SA

Remote work is becoming a major part of the everyday business landscape.

South Africa’s freelancers have opportunities to grow and thrive like never before, while the future of work will continue to encompass freelance work as it evolves.

Freelance work has grown exponentially in the last decade. In the year 2000, freelance workers were just 3% of the population. A 2017 report showed that that number has almost doubled to more than 5%.

Today’s world is built on faster, more digital connections that has enabled freelance and contract opportunities to thrive.

The future is bright for those in the freelance business and here are some the biggest future trends shaping this market.

Open offices

Co-working spaces relieve many problems for today’s freelancers. This has led to new co-working spaces to cropping up around the world over the last few years.

About 45% of free-lancers have reported loneliness and lack of inspiration that interferes with their ability to perform a job well.

Additionally, the distractions of working from home – particularly for those with families – makes it difficult to complete work.

Working hours

Hourly work will begin to disappear as more freelancers are paid by the project or deliverable, rather than hourly. For many freelancers, this increases their potential hourly takings.

Those who work efficiently and produce quality work can significantly raise their hourly wage in order to compensate for extra taxes and expenses like a co-working space.

The impact of AI

The future is somewhat uncertain regarding AI’s impact on every industry, but the freelance industry will, for the most part, remain untouched by this digital trend.

LinkedIn co-founder Reid Hoffman recently told Fast Company that the freelance market will likely withstand the impact of AI.

“AI as a massive threat to jobs is still … years off in different areas and different zones.

“A key part of freelancing is establishing a quick connection with a customer or a client, and then figuring out the job and working on it. AI is probably not a factor in that.”

Freelancers, therefore, think more proactively about market trends and refresh their skills more often than traditional employees, helping to advance our economy.

This resilience will help freelancers stand the test of time. Freelancers are preparing for a changing future, and the business market is poised to help them get there.

Among the challenges listed by free-lancers working across industries are time management, self- discipline and weighing the rates offered by a free-lance job with your own self worth.

Colin Don Shouw, is the managing director of business consulting agency the Fixer Group, that specialises in corporate branding, PR and events management.