Freelancers’ earnings have fallen significantly as a result of Covid-19, according to a new report.
Skilled freelancers’ average quarterly earnings have dropped to the lowest level on record because of the coronavirus pandemic, according to new research.
The report, How freelancers respond to an uncertain economy, by freelancers organisation IPSE found that the average quarterly earnings of highly skilled freelancers fell from £22,742 at the end of 2019 to £20,821 in Q1 of 2020 and £15,709 in Q2 – the lowest level on record.
The fall in earnings from Q1 to Q2 2020 was also the second-biggest drop since IPSE’s Confidence Index began in 2014 with the biggest being recorded in 2016 after the Brexit vote.
The drop in earnings in 2020 was because, although freelancers’ average day rates remained relatively stable, the average number of weeks they were not working per quarter rose from 3.3 to 5.5 out of 13, says IPSE.
IPSE’s longitudinal report on its Confidence Index also showed that freelancers’ short-term confidence in their businesses dropped to by far the lowest level on record because of the coronavirus pandemic.
Andy Chamberlain, Director of Policy at IPSE, said: “Overall, IPSE’s longitudinal report on our freelancer Confidence Index shows a sector that has been more attuned and exposed than others to political and economic fluctuations. Freelancers’ confidence in the economy has closely tracked political jolts like Brexit and government changes to self-employed IR35 tax legislation.
“Despite this, freelancers have generally remained more resilient and agile compared to other sectors – and their earnings and confidence in their businesses have generally remained much stronger than their confidence in the economy.
“However, these trends have been reversed by the extreme and extraordinary circumstances of the pandemic, leaving the freelance sector more financially fragile and in need of external support than at any other period on record.”