Here’s how to give it to them

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The past 18 months have both boosted and disrupted the gig economy, with some industries seeing significant increases in their numbers of freelancers, while others have shrunk their ranks. Even amid these seismic upheavals, one thing remains the same: freelancers aren’t going anywhere, and they promise to make up a significant portion of the future workforce.

Giving freelancers a voice in benefits negotiations

Partly because they are, by their very nature, independent of any larger organization, freelancers do not have a level of institutional influence commensurate with their population. As a result, some states (most recently California) have created legislation designed to protect gig workers, but the effect of these laws remains to be seen. As it stands, there are no freelance unions or similar bodies designed to protect benefits. Lyft and Uber drivers have been at the forefront of this fight for several years, as their respective companies have often sought to treat them as employees, but without giving them benefits.

With recent labor shortages and other difficulties in returning to a pre-pandemic operating state, many businesses are increasingly finding themselves outsourcing work like accounting and writing to freelancers. With these developments and with more and more American families depending on freelancing to survive, the question of what kinds of benefits to provide them is inevitable and vital.

Related: Why digital freelancing is the future of work

Freelancing is a business, and businesses need funding

Giving freelancers a voice to protect their job security and benefits will take government action, of course, but arguably the most important question to answer is how they can get funding for their businesses. There’s still a misconception that the self-employed simply pursue “side hustles” to help pay some bills or save for their children’s education fund, but that’s no longer the case. Increasingly, freelancers are independent contractors running freelance businesses full-time. Until public perception changes, they will be handicapped by a lack of access to sustainable capital, but this does not have to be the case: there is a growing realization that banks and lenders could greatly benefit by offering them specialized financing options. Banks would gain access to a market they have historically underserved, a market with record growth potential in the years to come (the first to offer such products would tap into a virtually unexplored market), and independents would gain by accessing capital that they desperately need to grow. Finally, unlocking this capital would benefit the economy as a whole: business growth means more and better-paying jobs, more competition and ultimately better value for consumers, while the government would see greater tax revenue, which further helps society.

This should be one of the few topics that enjoys bipartisan support in our country.

Related: The case of the independents

How a packed story is a roadmap to success

Many obstacles remain to turn this vision into reality, unfortunately, chief among them being the lack of recognition by banks and other financial institutions that freelancing is a viable business. Currently, these institutions have little incentive to reassess their models. As a result, freelancers face lending practices tailored to traditional businesses, making it difficult to provide the information a bank needs to make a proper risk calculation.

Freelancers have their own stories…experiences, reputation, network, skills and references. They also have their own way of working, but one gig economy worker’s story actually can be translated to fit a traditional lending risk calculus – a calculus that can put them on the banking radar to unlock the vast potential value of the digital economy, and it’s high time that lenders and freelancers alike combine their abilities to do so.

Related: 10 Online Careers You Can Start Today Without Money

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