Infographic: Are Self-Employed Creative Professionals Thriving or Just Surviving?
February 16, 2017
At FreshBooks, creative professionals represent a large group of our customer base. Looking at their hourly rates, recent data on FreshBooks customers showed self-employed creatives charge a median of $60/hour.
Of course, that number represents a very eclectic group of professions. Those who identify themselves as creatives cover a broad field—from writers to designers, photographers and many more.
We wanted to take a deeper dive into the hourly rate of creatives and look at the numbers by profession, location and even compare self-employed creatives to their salaried peers. The goal: To understand just how FreshBooks’ self-employed creatives are doing for themselves. Are they merely surviving? Or are they actually thriving?
First, Who Are FreshBooks Creatives?
Creatives thrive on inspiration, collaboration and friendship with other creatives.
Given the large base of FreshBooks creative customers, it wouldn’t a true representation to bucket them all under one job title. As mentioned before, FreshBooks creatives come from a broad, talented pool of professions. We took a closer look at some of the top creative roles for FreshBooks customers:
- Graphic Designer / Illustrator
- Interior Designer / Decorator
- Videographer / Photographer
- Web Designer
- Writer / Editor
Are Creative Professionals Better Off Self-Employed or in Salaried Roles?
These days, nearly every creative will consider their options: Will they be more fulfilled in full-time employment or by striking out on their own? There are many upsides and downsides to consider. If you choose the salaried route, you’ll have job stability, benefits and a predictable paycheck. On the other hand, if you become a freelancer, you’ll have the freedom to be your own boss and establish a solid work / life balance.
To see both sides in terms of numbers, we looked at the hourly rates of FreshBooks’ self-employed creatives against salaried creatives. Here, we found that FreshBooks creatives charge about 2–4 times more per hour than their salaried peers. Solely based on our findings, the numbers clearly favor self-employed creatives.
It’s important to note, however, that the comparison isn’t apples to apples. First, we must be mindful that every hour is not a billable hour, so the steady salaried paycheck does not exist for self-employed creatives. Next, it’s important to remember benefits, vacation days and other employee perks are included in a full-time salary, but are excluded for those who are self-employed. To account for these extra costs, this infographic from the Creative Live Blog breaks down how to calculate your freelancer hourly rate.
Despite the apples to oranges comparison, we can confidently say FreshBooks creatives are exceeding industry standards. To put this into perspective, self-employed graphic designers and illustrators charge a median rate of $65/hour, while salaried employees make just over $19/hour. As an industry standard, it’s assumed 30% of self-employed income goes towards benefits and vacation days, and an additional 30% towards business expenses. For the self-employed graphic designer / illustrator we mentioned above, that would bring their hourly earning to $26/hour—a rate still comfortably above their salaried peer.
Go Where the Creatives Go: Where Are the Hotspots?
Creative professionals often believe they need to be located in a major city in order to thrive. This stems from a desire to be in a healthy creative market (usually a large urban hub) and a thriving creative community. After all, creatives thrive on inspiration, collaboration and friendship with other creatives.
According to our data, here are the top hubs for many of our FreshBooks creative professionals:
- New York
- San Francisco
- Los Angeles
Based on our findings, it would seem for our customers at least, that improved online connectivity does not outweigh a desire to be in an urban, creative city.
Of course, it’s important to note that these creative hubs are also some of the most expensive cities to live in. It’s not uncommon to read stories saying the arts are being priced out of these cities and pushed into suburbs and other locations.
The good news is our creative customers appear to charge enough to live comfortably in these cities. Taking the necessary deductions into account—like benefits, vacation days and business expenses—FreshBooks creatives are still earning an above average income.
The Verdict: Creatives Are Thriving
Based on our findings, self-employed creatives are indeed thriving… and not only compared to their salaried peers. Despite choosing to live in some of the largest US hubs, self-employed creatives still maintain an annual income well above the cost-of-living in their cities.
However, we can’t ignore how this living situation might change in the future. Considering the constant changes in employment behavior, it will be interesting to see how these numbers shift given the rise of digital nomads and remote workers.
This post was written by Megan Santos, Content Editor at FreshBooks—and Carly Moulton, Marketing Coordinator at FreshBooks.