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OnlineFreelancing:Anemergingnewemploymentopportunity

ThisworkwascarriedoutwiththeaidofagrantfromtheInterna6onalDevelopmentResearchCentre,CanadaandtheDepartmentforInterna6onalDevelopmentUK..

HelaniGalpaya,SuthaharanPerampalam&LaleemaSenanayake

Colombo,6thDecember2016

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WhatisOnlineFreelancing?

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Buyersandsellersconnectedatlowertransac6oncost

Onlinefreelancerswithvariousofferings

Clientslookingforvarious

services

RegisterwithaonlineplaLorm

•  Companies•  Professionals•  Individuals

•  Students(58%)*•  Thosewithdayjobs•  Fewothers

*Surveywithfreelancers(n=84)

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QuanNtaNvecomponent•  Na6onallyrepresenta6vesurveyof16-40yearpopula6on(n=5,377)•  Surveyofpoten6alfreelancers(n=160)•  Surveyofcurrentfreelancers(n=84)conductedatDialog’sFreelancerSL2.0

eventQualitaNvecomponent•  Focusgroupdiscussionswithfreelancers,poten6alworkers(youth&

youngmothers)

FocusgroupdiscussionsinJaffna FocusgroupdiscussionsinColombo

Findingsofmul6-prongedresearchconductedinSriLankain2016

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Freelancingdiffersfrommicrowork;majorityprefersfreelancing

Projectbased

Skilled

Professionals

Lowskilled

Microtasks(ad

click)

Novice

Onlinework

Freelancing(Fiverr,

freelancer,Upwork)

Microwork(Gigbucks,clixsense)

Disadvantages•  Notworththe6mespent•  Difficulttogetpayments•  Takes6metofulfillminimum

requirement•  Somefreelancersstartwithmicro

workbutmigratedtofreelancing

Advantages•  Valuecommensuratefor6me

spent•  Skillsnecessary•  Noissueswithpayments

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Mostrespondentsbetween20-28yrsandlivedwithparents

6

C

Familydetails

LocaNon

OccupaNon

SEC

EducaNon

Age

TechnicalqualificaNons

Gender

Freelancer

•  Mostly18-27yearsold(73%)**•  AberA/Ls

•  MostlyfromSEC*BandC

•  Fromsuburbanareas

•  Mostweremales(92%)females(8%)**

•  Programmingqualifica6ons(E.g.:C+,Javaetc.)

•  Graphicdesignqualifica6ons•  Accountancyqualifica6ons

•  Followingdegreeordiplomacourses(58%)**

•  Students•  Entrepreneurs•  ITadministrators

•  Almostallrespondentslivedwiththeirparents

*SEC–SocioEconomicClass,measuredthroughoccupa6onandeduca6onofchiefwageearnerofthehousehold**Surveywithfreelancers(n=84)

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ScopingtheonlinefreelancingindustryinSriLanka

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Wees6mate17,000-22,000onlinefreelancersinSriLanka

22,000Freelancersbasedonna6onally

representa6vesurvey

17,000Freelancersbasedoncoun6ng

plalormregistra6on+es6ma6on

Growingatarateof44%peryear

14%9%

15%

6%

25%21%

9%

Only1Month 1-3Month 4-6Month 6-12Month 1-2Years 2-5Years Morethan5years

DuraNonasfreelancers,basedonnon-representaNvesurvey

Base: Freelancer Survey All Respondents (84)

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TargetAgeGroup(16–40)Numberofpeople

%ofRespondents

7.7Mn100%

Yes,awareoffreelancing/microwork

2.0Mn26%

No,unawareoffreelancing/microwork

5.7Mn74%

Yes,involved No,notinvolved

22,0001.1% 1.98M98.9%

Basedonrepresenta6vesurvey,wees6mate22,000freelancers

Areyouinvolvedinfreelancing?

Areyouawareoffreelancework?

Outofwhich7,700registeredwithinlast6months.Furthervalidatetheannualgrowthof44%

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Es6mated17,000freelancersregisteredinplalormswith1.5accountsperperson

Freelancing/MicroworkPlaLorm

%ofRespondents

NumberofFreelancers

AlexaRanks(2015–2016)

Fiverr 60% 10,020** 64à32

Freelancer 33% 5,511* 289à257

Upwork 29% 4,910* 264à235

Adsense 13% 2,154

Peopleperhour 6% 985

ClickSense 6% 985

Neobuxs 4% 585

TotalFreelanceraccounts 151% 25,150

No.ofuniquefreelancers Aveof1.5accountsperperson App.17,000

*PhysicallycountednumberofSriLankansregistered**Fiverrdoesnotreportregisteredsellersbycountry.NumberofFiverruserses6matedbasedonotherplalormnumbers

Base: All Respondents (84)

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Benefitsfromfreelancing

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0 200 400 600 800 1000 1200 1400 1600

AverageMonthlyEarninginUSD

AverageMonthlyIncome(75$-150$)

0 50 100 150 200 250

AverageValueofEachProjectinUSD

Mostfrequentprojectvalues(5$-10$)

Byworking2-3hrs/daycanevenearnLKR20,000(USD140);closetoLKR50,000(USD350)iffull6me

Source:SurveywithFreelancers(n=84),Focusgroupdiscussions(n=28)

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Onlinefreelancingisagatewaytoservice-sectorjobsandstartups

•  Improvementinsobskills•  Learningtomanageclients(localandinterna6onal)

•  Mee6ngdeadlines

•  Communica6ngeffec6velywithclients

•  Nego6a6ngadeal

•  Managingclientexpecta6ons

•  Opportunitytomasterspecificskills(e.g.,logodesign,transla6on,programming)

•  Freelancersgraduallymoveawayfromplalormsandbecomeentrepreneurs

•  Rajika:FreelancerèEntrepreneur•  FormedstartupwithanAustralianPartnertoprovidegraphic

designservicesmainlyforEuropeanandAustralianclients

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Benefitstotheeconomy

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•  NumberoffreelancersinSriLankais17,000-22,000

•  Whoareac6veandmakingregularincome-40%of19,500(7,800)

•  Monthlyaverageincome-$200

•  Totaltake-homeincomeperyear-$200*12*7800=$18.7Million

Freelancersexportservicesandbringforeignincometocountry(calcula6onsbasedonpessimis6cassump6ons)

Comparison Revenueperyear

(millions)

Employees Peremployee

contribuNon

Natureofwork

BPOIndustry $850* 80,000* $10,625 Full-6me

Freelancing/Microwork

$18.7 7,800 $2,400 Majoritypart-6mers

*SLASSCOMStrategydocument2016,hqps://slasscom.lk/sites/default/files/SLASSCOM%20Strategy%20Document%202016.pdf

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Awarenessofandwillingnesstoengageinfreelancing

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26%of16-40agegroupawareofonlinefreelancing

26%74%

Yes No

DescripNonofFreelancingByfreelanceworkwerefertositua6onswhereapersonisusuallyself-employed,worksfordifferentcompaniesorindividualsonassignments,andusuallygetspaidperassignment.Workusuallyincludeswebdesigning,logodesign,crea6vewri6ng,andaccoun6ng.Thefreelancerusuallyworksfromhomeoranotherloca6onthatisunconnectedtothefirm/individualwhoispayingforthejob.

Q:Areyouawareoffreelancework/moneyearningjobsthroughonlineplalorms?

Base: All Respondents (5377)

Atna6onallevel,within16-40agegrouponly26%wereawareoffreelancing/microwork

Overallawareness

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AwarenesshigherinNWP,SP,NCP,CP&SABthaninWPAwarenessofFreelancing

WP

SP

EP

NP

NWPNCP

UVA

SAB

CP

25%

75%

33%

68%

6%

94%

10%

90%

44%

56%

30%

70%

26%

74%

18%

82%26%

74%

AwareofFreelancing

UnawareofFreelancing Base: All Respondents (5377)

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Kurunegala,Anuradhapura&PuqalamDistrictshavehighestawareness;Gampahabelowna6onalaverage

2%2%

6%8%

13%15%

17%18%18%19%

24%25%26%27%

29%29%

35%35%

38%42%42%

46%

0% 10% 20% 30% 40% 50%

VanniBatcaloa

TrincomaleeAmparai

NuwaraEliyaPolonnaruwa

KalutaraMonaragala

BadullaJaffna

MataraKegalle

GampahaRatnapuraColomboMatale

HambantotaKandyGalle

PuqalamAnuradhapura

Kurunegala

Na6onalAverage

20

68

57

52

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Don’thaveaninternetconnec6on

Don’thaveacomputer

Don’tknowanyinforma6on

Idon’thavethenecessaryskills

12%of16-40agegroupwillingtofreelancebutfacebarriers

0.3%

11.7%

88.0%

CurrentlyworkingWillingtoworkNotwillingtowork

TotalPopulaNon(16-40)Willingnesstowork

Willingtowork,butfacebarriers

Base : Those who are willing to work

Base: All Respondents (5377)

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Problemsassociatedwithonlinefreelancing

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HighlycompeNNveandpricesensiNve

Inabilitytomaintainworklifebalance/Difficulttodowithdayjob

Lowjobsecurity

Lowtrustamongfreelancersonpaymentmethods

PlaLormtakescutandfavoursthebuyer

BuyerhasmorebargainingpowerandplaLormsarebiasedtowardthebuyer

Lowuploadingspeedofbroadband

ManagingpercepNonoffamilyandsocietyàworkingfromhome

Reportednega6ves

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Onlinepaymentmodesandinwardremilance

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Paypals6llaproblem,butfreelancersworkwithmul6plepaymentsolu6ons

Plalormwallet

•  Fiverr•  Freelancer•  Upwork

Paymentfrombuyer

Inwardremiqancenotallowed

Margindeductedateverystages

$100 $80 $77.420%deductedby

plalorm3%deductedonline

wallet

$75.62%-3%deductedbyBanks&eZcash

$200

PaymentmodesWayofcashingout

locally

$264Toearntakehomecashof$200,freelancershavetoearn$264

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SoluNonsforfreelancers

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Whatonlinefreelancersneed

Beqerinward-payment

mechanisms

Insurancesolu6onsto

reduceearningvola6lity

Waystodemonstrate

creditworthiness

Improvesocialpercep6onand

image

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Summary•  OnlinefreelancingisanewICT-basedemployment

opportunity,gainingpopularityamongSriLankanyouth•  Es6mated17,000-22,000onlinefreelancersinSri

Lankain2016,growingrapidly•  Youthearningaqrac6veincomesthrough

freelancing•  Freelancingisagatewaytoservicesectorjobsand

entrepreneurship

•  Freelancersareserviceexporterswhobringsignificantincometothecountry

•  Beqerinward-paymentmechanisms,insurance,proofofcreditworthinessandimprovedpercep6onswithinsocietycanhelp