Freelancers Are Racing to the Bottom
I was having a conversation with someone in my network recently about what the state of freelancing was like lately. We connected because she is a resume writer, and I had founded Level Up Prep, which includes a resume writing service, so we saw an opportunity to talk to someone who was sharing space in a field that was experiencing a challenge. Like me, she had been in the recruiting field previously, and was finding it tougher to attract clients to her business than she had before. There was a palpable change in the way that potential customers were evaluating her work, and she wondered if I had checked out LinkedIn's new service, ProFinder.
I had, and I had some concerns, which I shared with her, but first, an explainer for those of you who may not be familiar. For certain industries, LinkedIn hosts a space where you can seek professionals (freelancers) for a job you need done. You post the details of the work, and pros bid for the job. You evaluate their background in addition to what they would charge you to do it, and select the candidate you like best. It's a matching service, essentially.
As I said, I had looked into it as a potential customer acquisition channel for Level Up Prep, but I had concerns. The first was that I was expected to fulfill the request of the person asking for the job, rather than providing the service I felt was best. This is a pretty good system if you're asking someone to build you an app or design a website, but when you are asking to rely on someone's expertise to help you create your resume, you're losing out on the knowledge you paid for. My colleague had noticed that she was getting a lot of pushback lately from clients who wanted certain things on their resume that she knew to be ill-advised. It puts her, and anyone else with a strong affiliation with quality, in a difficult position. Do you stick to your guns and potentially lose a client to a more mercenary pro who will just do what the client wants for the money? Or do you become the mercenary?
The other effect we both noticed is the race to the bottom in pricing. Freelancers' time is getting to be cheaper and cheaper because of tools like ProFinder, Fiverr and TaskRabbit, which try to Uber-ize everyone's time. Make the service as simple and no-frills as possible, undercut everyone else's price, and pay the worker the lowest wage allowable that still gets the work done. Once you include the time you spent bidding on these jobs (and let's not forget, you won't be selected for all of the ones you bid on), performing the work, collecting your pay and doing all your back end bookkeeping, does it even average out to minimum wage? My colleague lamented that it often did not. What's the point of even freelancing?
As a freelancer or business owner, you have to determine what your value is, and stick with it. There will always be someone who is going to try to convince you that you aren't worth what you say you are, and you need to be confident in what you are worth. You should also have in mind how negotiable you are. It's good to be willing to be a bit flexible to win someone's business, but not so flexible that you're undercutting your budget. You need to be able to pay yourself, cover your costs and, ideally, make some money to put back into your business. If you're not covering that, it wasn't worth your time.
My colleague and I lamented the way freelancing has been going, but in order to turn the tide, we have to be willing to expect differently for ourselves. We'd all have to decide not to go that route, and stick to it. I think we've all seen how that story goes, though - there are plenty of freelancers bidding on ProFinder, plenty of Uber drivers. Plenty of people are willing to work low wage jobs when they're worth more.
What do you think? Let me know in the comments below.