Job markets frought with peril
Freelancing can bring quick cash if managed the right way. Today’s job market is still struggling. The unemployment rate throughout the US surpassed 10% months ago. Businesses are still not creating jobs and a lot of the jobs that were eliminated won’t be returning. For example, Detroit’s heavy car manufacturing industry took a huge hit throughout the recession. Larger companies in the city and the auto industry suffered terribly. These jobs might never return, leaving thousands out of work and with few prospects for the time being.
So what is the answer to lack of jobs?
More consumers see the lack of jobs and losing hope. Though having a typical 9 to 5 job was desired (and still is), things are changing for many people. The recession taught people well that trusting in employers is not always the best option. As market conditions worsened, layoffs and cutbacks seemed to be what some businesses had to do to survive. People counting on their employment to get through the recession were cast into the growing pool of the unemployed. Workers who weren’t laid off also felt the strain. Those left to pick up the slack had to do so for no additional pay or bonus, whatsoever. Now that the recession is proving to be lasting longer than first projected, a good portion of consumers are taking things into their own hands and looking to freelancing.
The typical freelancer
Freelancing has gained a new respectability in the market due to the high unemployment. Jenny Hemphill, of St. Charles, Illinois said, “I worked for a small finance company that took a huge hit in 2008. They cut back and that included getting rid of my position. I applied for over a year and found nothing. Freelancing was the option that made sense. I could take matters into my own hands, without relying on a job market that still is bad.”
The bad job market is still what is pushing people to move outside of the box when it comes to finding quick cash. Freelancing is becoming a primary career focus for people who used to consider it secondary. Those looking into it as a career choice should be aware of some risks. Experts warn that the first step to moving into freelancing is to do some math on the pay per hour. Career counselor Tom Balliston, said, “It’s always good to figure out exactly how much is coming in per piece or per project. Thirty dollars may sound good, but if the amount of work takes two 8-hour days to complete, that averages out to less than $ 2 per hour.”
Another good tip is to create a standard contract. According to Balliston, it’s a good idea to invest in hiring a lawyer for small businesses and have him draw up a contract. At minimum, the contract should specify in writing the number of hours expected, the cost for additional time, and the pay expected. Balliston added, “If you don’t specify in writing the details, you may find yourself negotiating various minutiae throughout the course of the project. Worse still, if your contact leaves for whatever reason, you won’t have proof of the terms that were agreed upon.”
Finally, getting a good accountant is crucial to managing a freelance business. Part of freelancing tax law are saving 20 to 25% of all income for taxes and keeping records of all business expenses. There are state and city licensing or tax issues to get through. It is better to leave the details to the experts. Having a tax professional to assist can keep people from penalties and fines.
Freelancing for the next year
Freelancing is projected to increase in 2010 due to the market. Consumers are tired of waiting for the job market to turn around and are making moves to find quick cash on their own. Rules and regulations do exist, so you want to have all your ducks in a row and the right professional advice on how to manage.