Rise of the freelance economy

It’s 6am. You open your eyes to snooze your beeping alarm and all you can think of is how much you’d love to stay in bed just a little longer, but you can’t.

You need to get up and get ready to beat the morning traffic jam and get to work on time. After all, being late to the office might affect your performance review.

With a heavy sigh, you pull yourself out of bed and trudge around the house, getting yourself ready for another long day at the office. As you get into your car, you start to wonder again if it’s possible to just stay at home today.

It sounds tempting but with a sigh, you whisk the thought from you head – you can’t waste your annual leaves on a whim.

Spending nearly an hour in traffic, you make it to work and spend the day attending to work duties until you finally make it back into your car where you spend another hour in traffic before making it back home.

As you collapse on the sofa and drown your senses out with TV, you think to yourself – ‘I could have probably gotten more work done today if I could work from home’. Honestly, you’re probably right as commuting alone could have saved you a few hours of precious productivity and energy that would have been better utilised elsewhere.

And globally, companies are already picking up on this as many innovative players have already started implementing moves to increase work flexibility and balance in their employees in efforts to drive up work productivity and satisfaction.

Sadly however, this new way of thinking has yet to penetrate our local mindset and as a result, most of us are still stuck trying to meet the demands of our rigid 9 to 5 corporate lives.

 

An alternative to traditional employment

Because of this. more and more Malaysians have begun to forgo traditional employment for alternative sources of income like freelancing where workers are self-employed by making themselves available to undertake specific, short-term jobs in return for an agreed sum of payment.

They often find ork through the internet and are mpowered to work on their own terms – deciding their own schedule, where they’d like to work, what projects they’d like to undertake, and keeping all their revenue

And from a company’s perspective, they might be the ideal solution to some jobs that are too small and infrequent to hire a full-time employees for.

According to the Employees Provident Fund (EPF), our preference switch to freelancing has caused our freelancing economy to experience a strong growth of 31 per cent.

Reports from freelancer.com support this claim, revealing that Malaysia has the third largest freelancing market in the region with most of our jobs being involved in coding work such as PHO, MySQL and software architecture.

Meanwhile, a survey from INTI International University and Colleges (INTI) of 300 local freelancers yielded results that indicated 68 per cent of freelancers in Malaysia choose to freelance in spite of the availability of full time jobs.

This survey cited that respondents had listed flexibility in which they have the option to choose projects and have more control over their own working hours as the main reasons why they chose to freelance over getting a traditional job.

The survey also reported that freelancers were found to be in a unique position to make choices in what they want to do rather than being tied down to a scope of responsibilities found in traditional employment.

In essence, this means that freelancers can pick and choose the jobs that they think will best suit their career ambitions – translating to either a fast track to a specific career goal or broader prospects in future career paths due to freelancers learning more diverse skills from their varied work and clients.

In a statement, INTI explained that this strength and advantage could help create dynamic and versatile professionals that could become real assets to organisations and the economy as they leverage a broad perspective of ideas when engaged in projects.

Timothy Bulow, chief executive officer of INTI International University & Colleges affirmed that the freelancing economy is changing the way we think about careers and has expanded job prospects beyond traditional employment.

“With young professionals opting to freelance in spite of the availability of full-time work, the impact of this shift must be given serious consideration if we are to leverage these talents in advancing the economy,” Bulow commented following the release of the survey.

In addressing the advantages of freelancing, the survey found that freelancers are in a unique position to make choices in what they want to do rather than being tied down to a scope of responsibilities. This creates diversified work exposure, enabling freelancers to learn new skills and insights from client to client.

As dynamic and versatile professionals, freelancers could become real assets to organisations and the economy as they leverage a broad perspective of ideas when engaged in projects.

Having said that, the world of freelancing may not be for everyone as there are a lot of trade-offs involved, such as inconsistent work and cash flows, having to juggle multiple clients, lack of medical benefits, no paid time off, and increased workload.

 

Eye on money matters

The lack of financial security and sustainability in the long-term is especially concerning to local freelancers.

The INTI survey pointed out that a whopping 66 per cent of respondents do not have retirement plans while 33 per cent do not even have a personal savings plans.

These worrying findings lend support to EPF’s recent call to the government for the need of more incentives under retirement savings schemes to ensure that all Malaysians including those who are freelancers will have adequate financial protection in their old age.

Speaking on the matter, Wong Thee Chuan deputy manager for the strategic management department of EPF said that the dire situation highlights an intense need for improved financial literacy among Malaysians.

“It is worrying that despite the growth of the freelancing economy in the country, these professionals do not save for retirement, as about 70 per cent of Malaysians are below the global levels of acceptable financial literacy rates.

“It is important that freelancers should start equipping themselves with sound financial management knowledge as they are at higher risk of not having a long term retirement plan compared to full-time employees,” Wong said in a statement.

However even with better financial literacy, many local freelancers have also cited that they experience financial woes due to a lack of accessibility to financial services as financial providers tend to not recognise freelancing as a stable and formal career.

In response to this, 65 per cent of INTIs survey respondents indicated that their top wish would be for the government to recognise freelancing as a formal career so that they would be eligible to apply for social security, loans and capital that would facilitate their financial sustainability.

With more access to financial services, our local freelancers would be more likely to succeed in their respective careers.

However, INTI’s Bulow pointed out that finances are not only the hurdle that freelancers would have to overcome in their quest for success.

 

Photography a good step for freelancers

Starting out his career in the informations and technology (IT) sector, Kuchingite Allen Ang is now pursuing his career as a  full-time freelance photographer in Kuching.

Ang picked up photography as merely a hobby at first but after proving to be extremely talented at it, his photography work slowly evolved from being a source of enjoyment to being a source of income in his daily life.

Now, Ang works as a full-time freelance photographer under the brand AllenAng Photography. BizHive Weekly talks to Ang about job prospects in freelancing photography and where he thinks the industry is heading:

 

Q: How did you get started in freelancing?

A: Actually, it really wasn’t by choice! I was in the IT industry previously and at one point I was out of employment. I was actively looking for a new job back then but I got tired of waiting for job opportunities. I then decided to try out whatever was available –  so I began working as a freelance photographer during that period.

Before that, I had already started photography on the side during my weekends. I had interest in it and people started suggesting that I do it commercially – so I did.

It was really tough starting out back then because my income wasn’t that good and I had no idea how to conduct business or get customers. I eventually did find steady employment again but after giving it another go, Ive decided to go back into freelance photography.

 

Q: Why choose freelancing over regular employment?

A: After accepting another job in the IT industry, I quickly came to the realisation that IT isn’t really one of my strengths; it was just my academic qualification.

And because I still was not considering photography as a formal career at that point in time, I ended up trying out a few industries in hopes of figuring out what exactly I wanted to do. I eventually ended up going into the insurance industry to try my luck and I gave it my all for around two years. After those two years, I realised that it still wasn’t what I wanted to do, even though the career prospects and incentives in the industry was rather attractive. My first interests continue to lie in the arts and creative fields so I decided to go back being a full-time freelance photographer but this time I would be more prepared. Once I got back on track with my photography work, I closed the chapter on my insurance career.

 

Q: What is your view on the financial situation freelancer face in this time and age? Do you have any advice for aspiring freelancer out there?

A: There are a lot of financial issues out there for freelancers so that is why I ended up registering myself as a business formally. Some people have asked why do I do this this and advised that it would be more beneficial for me to go off record so I can avoid taxes. That is true in a way — but if you look at it from another perspective, when you don’t have a record, then you don’t have any credentials in financial support. If you try asking for loan facilities, no one will supply you with it because they have no insurance that you can pay.

Without loan facilities, it will be very hard to grow your business or make any big-item purchases like cars or houses. So my advice to anyone looking to start freelancing is to keep up with your financial paperwork.

While it might be tough as a one-man show, its still very vital to your future so I suggest maybe consider hiring an accountant to do your accounts for you.

So, if you’re looking to jump into freelancing as your main source of income, I recommend that you have enough savings to support yourself for a while. The higher your current commitments, the more savings you will need. But if youre young without any commitments then maybe you can try it out and just learn from experience if it doesnt work out.

 

Q: What are your long term plans with freelancing? Any other future aspirations beyond this?

A: Eventually, I would like to build up a proper business. I plan on building up a team so that I dont have to run everything myself and also to help expand and diversify my business.

I’ve always wanted to try my hand in the F&B business and its a dream or idea of mine to tie my photography business to something F&B related by maybe creating a photography themed café.

 

PR on the sides

After 20 years in public relations (PR) and marketing, industry expert Ooi See Bee came out to start her own business in the F&B market, but on the side she continues to freelance as a PR professional.

Working independently with companies in Sabah and Sarawak, Ooi has undertaken several projects in the property, retail, entertainment and fast-moving-consumer-goods industries. She shares her views about running her business concurrently with freelancing work in Kuching:

Q: How did you get started in freelancing?

A: When I started my own ice-cream business, Cloud 99, I decided to continue my work in PR and marketing by freelancing to help support my main business.

I don’t freelance full-time or at full force because I have other commitments so I only take up job offers when they come.

 

Q: Why did you choose freelancing over regular employment?

A: PR is a very new field here locally (in Sarawak), so many companies do not have designated PR personnel. They might have a person who does marketing and PR and everything else but they do not have anyone that specialises in it.

In KL, however, it is very different they have people specialising in PR, marketing, and communications.  So thats why I thought of just starting small here to help build up the local industry and educate local companies. Besides that, I also have my own family to juggle now so I chose to freelance for flexibility because my work would be based on my own time management instead of following the time management of others.

 

Q: What is your view on the financial situation freelancer face in this time and age? Do you have any advice for aspiring freelancers out there?

A: Freelancing is a very tough job to handle because of financial restrictions. To bypass these, you need proper documentation, you need to consistently contribute to your EPF and you need to make sure you have savings otherwise you will have so many things you cannot do.

So unless you’re very well off, you need to be the type of person that can diligently manage your documentation, payments and financials properly.

Besides that, you also have to factor in that freelancing payment collection is very bad.  If the person youre working with gives you cash then its ok but sometimes if you’re engaged with big corporations, payment can be very tough because they cannot give you cash and they have so many terms and guidelines to follow.

You may have to wait for 30 or 60 days before payment is received so you need to prepare for such a scenario.

For my advice to aspiring freelancers, honestly, I recommend that you should think wisely before making freelancing your primary income because certain industries will need a lot of experience and notoriety before people will engage you.

For example if you’re offering a skill that can be easily appraised like writing and art, it might be ok to start with freelancing but industries such as event management for example will need to know youre experienced and trustworthy before they engage you.

But most importantly you must know what your strength is because it is one of the most important keys of freelancing alongside networking. You need to network in order for you to grow your business and find new clients and you need to know your strengths so that you can effectively advertise yourself to clients.

 

Q: What are your long term plans with freelancing? Any other future aspirations?

A: For now, my PR work is just a supplementary income to support my business but in the long-term I’m hopeful that I may be able to work with an agency that helps engage PR professionals with companies. I already have this arrangement with a friend from Sabah who owns an agency and refers me to jobs but I’m hopeful to find an agency in Sarawak where I am based. With an agency I can get more consistent jobs in terms of PR and marketing work.

 

Breaking barriers digitally

It is without doubt that digitization brought about changes for the freelancing economy in a major way as it eases the matching of supply and demand.

Take for example Uber, Airbnb and Grab – gig economy leaders which have all been hailed as the “go-to” for consumers interested in experimenting with a one-off gig which they have the option of dropping should they not like it.

For freelancers, with the rise of digitalisation, one of the key struggles that freelancers previously struggled with has seemingly disappeared almost overnight.

The struggle to find work and new clients is almost non-existent now as both social media and e-commerce platforms now an integral role of connecting freelancers with prospective job opportunities and clients.

With a few taps on a phone, a freelancer can easily broadcast and advertise his services to clients all over the world, but so is everyone else, including those who are only seeking freelancing opportunities to supplement their already steady income.

In the United States for example, multitudes of platforms keep freelancers on a list to offer clients the chance to choose and pick the freelancer of choice, if they have a preference.

This has created a hyper competitive environment as clients are now free to choose the services of any freelancer in the world, so long as their jobs can be done digitally. Because of this, there is a strong need to give local freelancers a competitive edge.

According to INTI’s survey, 80 per cent of its respondents indicated that they believe skills such as communications, interpersonal skills and problem solving skills are vital to have for long-term success.

Yet 58 per cent of respondents also felt that tertiary education had not sufficiently equipped them for freelance careers, suggesting that the Malaysian education system is not doing enough to prepare our new generation of professionals who are opting to move beyond traditional employment.

To address our future professionals skill gaps in our ever-changing job and economic landscape, Bulow of INTI said it would be necessary for higher learning institutions to reinvent their education offerings to meet the widening scope of employability.

“To ensure that we are preparing our graduates for diverse careers, INTI collaborates with over 450 industry partners in providing practical learning based on market needs.

“Integrated modules from IBMs Innovation Centre for Education, Alibabas Global Ecommerce Talents programme, and Google Ignite enhance digital literacy and help students to gain expertise in digital marketing and e-commerce – skills that help them build their online portfolios and market their services to future clients.

“Coupled with these are leadership talks, on-campus career development programmes and networking opportunities with senior business leaders that provide the transferable soft skills needed for graduates to excel in any industry, both in Malaysia and globally,” he said.

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