The state of freelancing: adland weighs in as recession hits

Chief executive Mark Read says the focus on more permanent staff will help deliver better margins, but the news comes after what has already been a turbulent few years for the freelancer market.

From Brexit to Covid-19, increases in taxation and decreases in support for freelancers have meant many are stepping into more permanent roles for the sake of security as the UK slides into yet another recession.

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Matthew Knight is chief freelance officer at Leapers, which supports the mental health and wellbeing of freelance and self-employed workers. He says the network is already seeing people become “far more open to looking for permanent roles and employment in order to make income a little more regular”.

Tom Armstrong is one of them. The Common People co-founder and a former freelance content specialist says that at the start of the pandemic he lost a year’s worth of work in two weeks. Even when government support kicked in, he tells The Drum he had “no meaningful work for months and months”. As a result, he says: “I just couldn’t see a future in it any more. Freelancing was stressful even before Covid and now, with the financial uncertainty of the cost of living crisis, it just isn’t for me any more.”

The decision to move away from freelancing saw Armstrong secure a full-time position through a former client last year. He’s now the head of creative content at Hamilton and Hare and says that the security has been a “weight off his shoulders”.

A cooling-off period

The sad fact remains, however, that in times of economic uncertainty, workers who remain freelance may be among the first to lose work or face difficulties. Knight calls them the “canaries in the coal mine of economic confidence”.

Post-Covid, he says, the demand for freelancers had been fairly consistent, ”driven by an increased acceptance of remote working, gaps in talent and resource influenced by the great resignation, and rapid innovation in technology”.

In 2021, the number of temporary workers employed by IPA member agencies was almost double what it had been in 2020. But now, we are seeing a “cooling off period following a period of explosive growth,” adds The Dots chief executive Pip Jamieson.

“But at the same time, we are hearing that there just aren’t enough great people around,” she says. ”This is due to many factors, including people leaving the industry or leaving the country because of Brexit.”

The state of pay

The fluctuating market has meant that many agencies “don’t have well-established processes for working with freelancers,” says Knight. “This can often lead to really valuable steps in working with freelancers being forgotten, missed or simply not happening: onboarding, decent briefing, fair contracts, respectful communication and, all too often, even the most basic of tasks such as getting paid on time.”

Knight says that in order to mitigate anxieties over late payments or limited work opportunities during this period, many freelancers are instead looking to increase their revenues by adding multiple sources of income. “We see lots of our members who are building up a wider range of services and offerings so they are less reliant on just one skill,” he says.

Pavan Riyat-Ward is the managing director of We Are The Allies, a freelance recruitment agency that is aiming to improve conditions for freelance talent across the creative industries. She says that they often see freelancers “undervalue themselves,” adding that they should have no qualms about increasing their day rates by £20 or £30.

She believes the big question for agencies as they approach recession is whether it’s more worthwhile to take of full-time staff for cost-effectiveness, or whether it’s more worth their while to take of freelance staff “as and when they need specialized skills”.

Knight agrees that freelancers should take heed that there is an increased demand for their skills as agencies continue to find it hard to fill permanent roles, which is allowing some to demand higher rates. “But conversely, we are also seeing lots of freelancers’ new business pipelines dry up and individuals might be forced to accept lower day rates to ensure they’re covering their income requirements.”

He says that, in practice, most freelancers are not in control of the day rate as it is the agencies and clients that are setting rates and project fees and finding freelancers who are willing to work at that cost, which can often mean freelancers who need to increase their rates “are costing themselves out of work”.

“There’s very little transparency or consistency in rates across roles and levels of seniority, which makes it harder to ensure fair pay for all,” says Knight.

As the cost of living crisis bites workers across every industry, Armstrong says it is people in advertising from working-class backgrounds and those “without a financial support network” who will be the most precariously placed in the coming months. A longstanding lack of support for freelancers’ mental health and wellbeing will also come back to bite agencies if they don’t improve working conditions for temporary staff.

These challenges are generally not from any malicious intent, concludes Knight, who says simply: “Freelancers, all too often, are subject to being brought in too late, lacking internal communication, or missing process and support for working with external talent.

“Sometimes, however, they are treated as second class people, as nothing more than a resource, and issues like significant late payment of invoices and ghosting are all too common.”

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