Andrea and all freelancers,
No one wants to pay fees, or taxes, but we do because everything has a cost in a free market.
Below is purely an interpretation of what has gone happened based on my knowledge having been a business owner. Remember, Upwork is not a non-profit, they are a for profit business and therefore exists to make money for their employees and stock holders.
Upwork, previously Elance & oDesk, came about to provide a service that was focused on the gig market versus hiring or temp work. In a very simplistic view, to compete in this market and gain market share they came up with a pricing strategy to not charge upfront fees but instead collect a percentage of revenue. This approach gave small businesses a way to compete in a very competitive market for talent and just pay for what they needed versus having an employee.
As the platform gained popularity I can see how the busines costs increased from the need for technology to support the increased use to the employees need to run the business.
So why the sudden change in pricing structure, that is fairly easy to see even without asking Upwork. The pandemic happened and there was a surge in people discovering that working from home was possible and they enjoyed it. More businesses realized that there were jobs they could outsource to freelancers. Both of these led to a surge in both job posts and freelancers joining.
Given what we know about Upwork financials now, the percentage they were collecting wasn't enough to support the growth they have gone through and most likely because of the number of jobs that never hire and with hourly paying being low. So, they had to come up with a new pay structure that they felt would keep them profitable and able to continue offering this service to both businesses and freelancers.
As freelancers we may not agree with their choices in how the fees are charged and who pays them, but as long as their are those that are willing to pay them and it is making Upwork profitable the fees will remain. I can say with confidence that Upwork is not going to change their fee structure unless it becomes unprofitable.
As individuals we do have free will and can choose to go other platforms for freelance work or we can decide to seek out fulltime employment and leave the freelance market. Freelancing is not for everyone and has become more competitive and it will continue to become more competitive. To compete you will need to do what small business owners have to do, learn to compete by distinguishing yourself from others and continuing adapting in an ever changing marketplace. For some, that means broadening your reach to a wider market utilizing multiple avenues to reach potential clients, and for others that means specializing and finding a niche market where there is less qualified talent to compete against.
It all comes down to your ability to adapt to change. Vent your frustrations, but once done, take a moment to examine your skills and what motivates you and then come up with a direction that you want to go and focus on getting there. What I find is that many freelancers do not consider themselves a small business owner, but that is exactly what they are. It is a different mindest and can be the difference of excelling or struggling to survive. If you haven't, you may want to look for resources on starting a small business and go through the steps of creating a business plan. There are a lot of free resources out there that can help.
