Online employment middleman Elance, for example, is experiencing record growth: up more than 50% overall year-over-year with more than 48,000 jobs posted in the last 30 days alone, and more than $300 million in total freelancer earnings since 2007.
Is this the new way of the working world? According to the Bureau of Labor Statistics, 68% of hiring in 2010 was contract-based. Independent workers now make up 30% of the nation's workforce, according to the Freelancers Union. And an overwhelming 90% of U.S. companies outsource a growing amount of work -- up from 6% to more than 27% since 1990, reports the Human Capital Institute.
Young people are advancing the trend. Elance just released findings from its national survey of Millennials (those born after 1981) indicating that independence is highly prized by the younger generation of workers. Getting a "foot in the door" is being redefined as "making sure they have your email address. " Many of them are making freelancing a cornerstone of their career strategy -- and it's working.
A Win-Win for Workers, Employers
Remington McElhaney, a 19-year old college student in northern Idaho, was a part-time cook at a local ski resort throughout high school and into his freshman year of college. One day, he came across a blog highlighting freelance work and was inspired to try his hand making money from one of his favorite hobbies -- animated graphic design. After one month, he found he was earning twice as much freelancing online than he was as a cook.
It works for the employers too. Companies large and small are looking to manage costs by lowering overhead and hiring based on real-time demand. Tapping into a virtual workforce allows for this, and has the added benefit of broadening the potential candidate pool. Suddenly, someone who is juggling child care or elder care, or who wants to live in a less expensive area, can be considered for jobs they otherwise would have been unavailable for. Plus, it offers the ability to do something most small businesses are striving for -- it lets you ramp up fast.
Witness Casey McConnell, CEO and founder of Qittle, which helps other businesses create, customize and manage mobile marketing initiatives. At first, Qittle was just him, but he sought outside help from freelancers in designing a logo, website and marketing brochures. Then, he needed technical support, and found just the right IT person on a freelance basis. Qittle now has about 20 staffers, 12 of whom are full-time and the rest of whom are contractors.
For McConnell, that mix makes perfect sense. Hiring through a site like Elance, he can access plenty of information about a given contractor's work history (freelancers get rated much like eBay power sellers), which takes some of the risk out of the hiring decision. It can also make the price right as freelancers compete for gigs. As a small business owner, that's an enviable position to be in.
Scoring a Virtual Job: Who's Hiring and How Much Can You Make?
VIP Desk: We checked in with VIP Desk and they tell us they are currently hiring for customer service and sales, which entails fielding calls for a VIP/concierge program or retailer. Anecdotally, they think there may be an uptick in applicants due to gas prices. Their typical employee is a 41-year-old with a college degree, which they claim helps provide the right mix of personal and professional experience. They expect hiring to ramp up toward the end of summer heading into the holiday shopping season as they scale up for clients like BlueFly and Eddie Bauer. Many of their employees -- including a school principal -- work with VIP Desk to supplement their income. You can expect to earn roughly $12 an hour.
Elance: Elance is seeing specific types of jobs heat up. How it works: You submit a proposal for the work, get hired, and agree upon terms and milestones. When the job is done, you submit your invoice and funds are released from escrow. This is key, because two of the things freelancers and e-lancers struggle with are getting paid and getting paid expeditiously. So the fact that eLance provides a tool to facilitate this and that projects are funded up-front is significant benefit.
E-lancing is great way to get a foot in door and build a reputation. You'll be rated on your work, and the better your rating, the more likely it is that more work will come your way. Over time, some e-lancers join up with other highly-rated contractors and bid on bigger, more profitable jobs. So, you may start by going it alone and end up joining others and earning a piece of a potentially bigger pie. Here are some of the hottest prospects:
Travel Writing: Publishers are looking to update their guides for the summer. Elance has seen a 54% increase in demand for writers specializing in travel in May.
Events: Executing big events is often an all-hands-on-deck effort. Event planning gigs jumped 28% in May, while photography jobs climbed 15%.
Marketing: Demand for marketers is on the rise, especially if you've got WordPress technical skills.
Video Game Programming: Demand for skilled programmers is up 30%.
How to Make Working from Home Work
If you're thinking working from home might be a good fit for you, here are some tips based on collective feedback from employees and employers:
Be a self-starter: The top employers for virtual jobs are selective, often accepting only a small fraction of applicants. While there are often clocks to punch in and out, there won't be anyone looking over your shoulder, so you've got to be reasonably self-motivated and reliable. If you've ever taken an online class or earned an online degree, skip to the front of the line: You already know how to handle this issue.
Like the work, love the location: When I asked about the common pitfalls of online contracting, one trap repeatedly came up: falling in love with the "at home" part of the equation, but not really loving the job. Bottom line: Just cause they'll let you do sales from home doesn't make you a salesperson. And, an euphoric as the thought of skipping the commute makes you, it doesn't automatically make you a people person with a penchant for customer service -- or anything else. Know thyself, and make sure the work -- not just the location -- fits.
Be tech-ready: There will likely be specific things you need to learn for a specific position, but overall, starting a new online assignment this isn't the time to try and master a new laptop or phone. Also, don't let yourself get frazzled by making rookie mistakes like running out of printer ink, losing your phone charger, etc. The more operational your personal technology, the more seamless working remotely is. The folks who are really successful at this will hear years later, "You were working from home? I had no idea!"
VIP Desk says they screen potential contractors for things like having a high-speed connection (you cover the cost) and a dedicated work area, as to avoid crying babies and dogs. Having said that, background noise is almost a given when you call into a formal call-center. So the next time you call a customer service number and don't hear anything, realize you're probably speaking with someone working from home.
Know your worth: Don't price yourself out of a job. Before making a bid, research what the going rate is for the work you're qualified to do. Just remember: Players with established track records can probably charge more, so you may need to undercut them on price when you're first getting started.
Over-deliver: Success breeds success. Once you get your foot in the virtual door, make your employer glad they chose you. Over-deliver to ensure they give you a high rating that boosts your reputation. That will bring more opportunities your way, not to mention giving you the ability to charge higher rates.
Beware of the red flags: Scam artists often prey on those looking to make a quick buck working from home. The biggest danger signs to be on the lookout for are requests for cash up front and extensive personal information. Be wary of "opportunities" requiring you to pay extensive fees in advance for supplies, sales kits and other materials. To the extent possible, you want the checks to be coming to you, not from you.
Podcast: Learn More About E-Lancing