Freelance software development booms amid COVID-19 and management rules are changing

Over the next year, the majority of hiring managers in the tech space "plan to increase their use of freelancers," according to a new Upwork report.

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Image: iStock/jacoblund

More than a year after the onset of COVID-19, the coronavirus pandemic continues to redefine the new normal of work, but its imprint could reshape the way companies fill positions for years to come. On Wednesday, Upwork released its Future Workforce Pulse Report, highlighting how the coronavirus pandemic has transformed hiring, management practices and the way companies leverage freelance talent across sectors.

"Remote work has become, what economists call, a general purpose technology," said Upwork Chief Economist Adam Ozimek, in a press release. "It has a wide range of uses that is embraced across the economy and creates a variety of spillover effects and we are already seeing the signs of these effects. The embrace of a more fully remote workforce has enabled businesses to embrace new technology, reimagine how they onboard and train, and even allowed hiring managers to embrace the use of freelancers."

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Remote work and freelance gigs boom

The Upwork report projects that more than one-quarter of U.S. workers (27.7%) will be remote in the next half-decade; up nearly 5% from the company's November 2020 survey. The coronavirus pandemic also "accelerated" companies' use of remote freelance talent, with 53% of respondents saying "remote work has increased their willingness to use freelancers," according to the release, and the vast majority of hiring managers (71%) said they were planning to "sustain or increase their use of freelancers" in the next six months.

Over the next year, freelance tech talent will continue to boom, according to Upwork, as nearly two in three hiring managers in the tech space "plan to increase their use of freelancers" during this time period. But, why are companies increasingly willing to tap freelance talent and is this trend related to recent high turnover amid a tight labor market?

One of the main reasons companies are increasingly willing to tap freelance talent, according to Ozimek, is businesses now having the "infrastructure to support freelancers;" whereas pre-pandemic, he explained, the "thought of onboarding or collaborating with a professional outside of the office or company was difficult for many businesses and hiring managers to grasp."

"But as businesses have had to figure out how to onboard and train employees in the context of remote work, many realized that they now can do the same with freelancers," he continued.

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Once businesses cleared the "hurdle" that is training and onboarding freelance talent, Ozimek said, "many" saw the "value of working with remote freelancers," such as the ability to quickly meet demand by scaling teams and tapping freelancers to assist with available work due to turnover amid a tight labor market.

It's important to note that this surge in freelance talent varies across industries. Since the start of the coronavirus pandemic, 80% of hiring managers in the web, mobile, and software development space said they have increased freelancer usage, according to Upwork, the largest such increase recorded. So, what's driving increased freelance usage within this software development category?

"This is an area of work where there is both a lot of project based demand as well as rapid scaling needs," Ozimek said. "Companies who need e-commerce operations launched quickly, or a fast redevelopment of their mobile site. This type of work lends itself well to freelancing."

WFH is changing management styles

Interestingly, the pandemic may also be shifting the way companies and managers choose to oversee and supervise workers. Compared to a "normal year," about two-thirds of respondent businesses (67%) said they experienced "more changes to long-term management practices" notwithstanding temporary adjustments made due to COVID-19, per Upwork.

Management, Ozimek said, is one area that saw "a great deal of change," with the switch to remote work, explaining that it is "likely" because "many of the old management practices," a la monitoring clocking in and out times and "glancing over one's shoulder," aren't possible in a work from home framework. 

"Instead, businesses have had to shift their mindset to think about the actual work being done from teams," Ozimek said. "Are people finishing their work on time? Is it high quality? Can I rely on them?"

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