The Freelancer Pay Gap
In the past half-decade, freelancing has gone from being a common way to earn in the digital age to becoming a fundamental part of “the new normal.”
In the U.S., the number of full-time freelancers grew by 91% and occasional freelancers by 132% between 2020 and 2023. Today, 72.1 million Americans — around 45% of the workforce — do freelance work some or all of the time, according to MBO Partners. Some have redefined their careers based on a change of circumstances or expectations during the pandemic. And others have graduated into a world where freelancing is simply a natural progression.
“Younger professionals […], as digital natives raised with the internet and social media, are creating a new blueprint for career opportunities outside of the traditional corporate world,” Margaret Lilani, VP of talent solutions at Upwork, told Fortune. For these digital natives, “uncertainty around college, internships, and the job market are coinciding with a mindset shift in how people are thinking about work.”
But unfortunately, one other way that freelancing has become “normal” is the wage disparity. In full-time permanent work, a woman in the U.S. will only earn 84 cents for every dollar a man earns. For our new study, we have discovered that, on average, a female freelancer charges just 79 cents for every dollar a male freelancer charges. Our team analyzed advertised rates across every U.S. state and major freelancing industry to identify the full scale of the freelancer pay gap in the U.S.
Methodology:
OnDeck gathered data on the number of firms, employees and annual payroll for family-owned and non-family-owned firms in every U.S. state and large metropolitan area from the U.S. Census Bureau’s 2023 Annual Business Survey. Next, the team calculated the percentage of family-owned businesses, total employees working for family-owned businesses and the average wage at family-owned businesses for each area. OnDeck also calculated the percentage change in family-owned businesses from 2020 to 2021.