Q&A: Rise Of The Freelancer
October 09, 2012 | Michelle Warren | Comments
Marketing unveiled its 2012 Salary Benchmarks survey in its Oct. 8 issue, running a sector-by-sector breakdown of salary ranges for every level of the marketing industry alongside reporting and commentary on issues shaping the marketing job market. Over the coming days, MarketingMag.ca will present some of that editorial package, explore freelancing, pay raises, title changes and talent retention.
The market collapse of 2008 produced a long-term shift in short-term staffing
Freelance has always been an integral part of advertising and marketing staffing plans—an inevitable by-product of a business model dependent on so much project work and short-term assignments. But in the past few years, say recruiters, things have changed. Agencies in particular have become even more dependent on freelancers.
Harry Manson, president of 3 Degrees Creative Resourcing, says about 75% of the people they place these days are in freelance roles. He spoke with Marketing about the rise (and fallout) of the industry’s growing reliance on freelancers.
Why are agencies more dependent on freelancers today?
When the economy went south in late 2008, there was a huge demand. First off, companies were spending less money on expensive traditional media and more on digital, so agencies needed to hire that skillset fast.
At the same time, most of the major international agencies had hiring freezes—they needed corporate budget approval for a full-time hire, but freelancers could be hired out of operational budgets so there was more flexibility. If you’re not allowed to hire full time people, you still have to meet client demands and get your work done.
Are there roles that involve more freelance?
Definitely creative departments have a persistent reliance on freelance; creative [freelance] runs as high as 50% in some large agencies, while digital production teams will often use 15% to 20% freelance.
Any innovation in technology will see an increase in the need for freelance. For instance, everyone is adopting HTML5 and you have to turn to the freelance community to find people with these skills first as in-house people are typically working with legacy technology and agencies are a bit slower to change the status quo. Any time something is new, people will make a hell of a lot more doing it freelance.
Is full-time employment the goal?
Not really. About 30% of people who are real freelancers will go full-time. Most are getting extremely high hourly rates so there’s no incentive. The only time they will go full-time is when there is saturation in the market of their skill set. Back in 2007/2008, digital project managers were getting $70 an hour, but now there is a lot more of them that actually have the experience and agencies have full-time positions for them, so they tend to go full-time.
How does freelance affect full-time salaries?
It has a huge impact in the short term, but there’s usually a correction. When new technologies come out, people who freelance charge an arm and a leg, but eventually in-house people develop these new skills and that corrects the demand.
Beyond money, what are the pros and cons for freelancers?
The flexibility: they can work for three months, then take off to Thailand and surf for six months. Gen Y freelances because it allows them the ability to manage their lifestyle in a way that emphasizes their goals, which consist of work being a means to an end.
But there are cons. Agencies aren’t going to give the coolest work to freelancers, it’ll go to internal people. Freelancers are often brought in to fix problems or provide a stopgap. Further, a freelancer’s growth and market value can stagnate. On the creative side, if all you’re getting is banner work, after a while it can becomes a detriment to your portfolio.
What’s the downside for agencies using a lot of freelancers?
It becomes increasingly difficult for them to retain corporate knowledge. When 25% to 50% of your creative talent has no loyalty to the company, it becomes harder and harder to differentiate yourself from the competition. With that in mind, you almost never see freelance account executives: why trust a client relationship to someone who doesn’t have a vested interest in your company?
How does this trickle down to affect clients?
You can argue that clients end up picking up the bill. But, if managed effectively it doesn’t have to be that way: the good agencies will eat the additional costs because it’s worth it in the long run to have the agility.