Remote work 'on the rise' for freelancers, full-time employees, Upwork CEO says

Upwork CEO Hayden Brown joins Yahoo Finance Live to discuss labor market trends and the outlook for remote work.

Video Transcript

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JULIE HYMAN: At the end of this week, we have the next payrolls report for the month of April. We'll get another read on the jobs market and the labor market at that point. The tight labor market that we have seen changing office environments, as well, are pushing some more people into freelance positions. Joining us with more on the changes that have occurred on their own platforms, Upwork CEO Hayden Brown, she's joining us from the Milken Conference out on the West Coast.

Hayden, it's good to see you. You guys reported your earnings last week. You saw a jump in users on both the corporate side looking for workers and on the worker side. What do you think freelancers are looking for, primarily, at this moment as we sort of come out of the pandemic?

HAYDEN BROWN: Julie, it's really clear that people want more freedom, flexibility, and control over when, where, and for whom they're working. And that trend started before the pandemic and has, certainly, accelerated over the last two years. Data that we've seen recently has shown that 10 million Americans right now are considering joining the freelance workforce.

And that's because of all the benefits that they see, really gaining that flexibility and that control over their work environment. And so, remote work trends, certainly, are on the rise. And that's for both freelance workers and for workers in the traditional office. And so this is something that's broad-based in the economy for workers both in the freelance side and more traditional full-time jobs.

BRIAN SOZZI: Hayden, as you monitor the wages that the freelancers receive in any job that they expect, do you get a sense that we're seeing some form of wage-price spiral?

HAYDEN BROWN: I think that both full-time workers and freelance workers are finding a really strong economy right now. And what we've heard, actually, is really interesting around. Freelance workers increasingly finding that this is a secure way of earning.

Before I think, people thought that during a recession or during hard times freelancing was not a safe place to work. And in fact, data and research shows when we talk to freelancers today, they find that freelancing is the safe place to go both for stronger earnings. They earn more, typically, when they're freelancing than they did in a full-time job in the past.

And in a tighter, more rough economic conditions, freelancers are telling us this is actually where they feel safe. They're not at the behest of a single employer who might lay them off. They feel safe because they have three, four, five steady clients. And if one of those projects or clients goes away, they know they can continue earning with the rest of the clients they have.

So increasingly, we're seeing a flip where people are saying freelancing is the safe place to go, even in an economic downturn. So it's both better earnings in good times and a safe place to go down in downtimes, which is really an interesting change, I think, versus the past.

JULIE HYMAN: And Hayden, I have to wonder, also, with inflation and cost appreciation for companies that we have seen, I have to wonder if they are shifting, somewhat, to more freelance workers because they don't have to pay things like health care costs, for example, because freelancers are a lower cost alternative for them. Are we seeing some of that kind of shift?

HAYDEN BROWN: You know, Julie, I think the bigger trend here is that a lot of companies are seeing in this market, they're trying to find the talent they need. And the traditional places they're going to find that talent, frankly, are not producing the goods. There is a huge war for talent right now. And they can't find the people they need in those full-time positions because the economy has simply moved. And workers have moved into the freelance economy.

So certainly, there can be benefits around cost-savings, around flexibility, around agility that a freelance workforce can deliver for businesses. And those benefits are strong. But I think the bigger picture is they also are getting access to skills and skilled workers who have moved into this workforce in droves. And businesses are waking up to the fact that to be current and to find those workers, especially younger workers, Gen Z workers, more than half of whom are freelancing today, businesses have to evolve their talent strategy to really go to where the workers are and be participating in this part of the economy.

BRIAN SOZZI: I apologize if I get this stat wrong. But I believe close to 10% of the freelancers on Upwork were in Russia and Belarus. What have you done in light of that situation between Russia and Ukraine? What happens to those contractors?

HAYDEN BROWN: Yeah, this has been an amazing story of resilience. You're right that 10% of our business was in Russia, Ukraine, and Belarus. And this has been, frankly, an amazing story of resilience, both workers in Ukraine are still working at or above the levels that we saw prior to the war breaking out. And we've actually seen a huge increase in sign-ups from Ukrainian freelancers who are finding our platform is a haven, actually, at these times because the flexibility that our model offers where Ukrainians can take their laptop with them wherever they're going, whether they're moving across the country, leaving the country. They can take that work with them and do it anywhere, which is a huge value proposition.

On the Russia and Belarus side we did make the very difficult decision to suspend our operations in those two countries and are winding down those operations. So we've seen a lot of people, actually, leaving Russia and Belarus who are still working on Upwork and moving to different countries where they can continue that work. And as of May 1, our contracts will be ending with Russia and Belarus for now while we kind of continue to watch that situation.

But the flexibility the portability of the work has been an amazing story. And on the same side, we've actually seen very limited impact so far in terms of the economics to our business because of the breadth, depth that we offer on our platform with clients and talent being able to find alternatives because our platform is very broad and very diverse.

BRIAN SOZZI: Well, thanks for making some time for us. I know Milken is always a busy conference. Enjoy. Upwork CEO Hayden Brown, good to see you.