Guest article by Dr. Gerhild Schulz: Corona crisis is putting freelancers under pressure
Nothing in our world is the same anymore - and we wonder if it will ever be the same again. While economic experts are anticipating a massive recession, the current global situation is hitting freelancers particularly hard. Many fear for their existence...
Marcel B., a freelance IT consultant at Daimler, has lost his job. The automotive company is now on short-time work. “The outsiders are the first to be kicked out,” he says. “I can only hope that the recession will be over at some point and that I will be hired again. It is uncertain how long that will take. I´m home now and my wife goes to work. To do this, she has to commute 150 km a day."
Klaus K., the owner of an interpreting agency in the top segment, also had to shut down. The company, which has been established for decades, is simply swept away by the crisis. "If high-paying orders ceased all at once and fixed business costs in the five-digit range for rent and salaries can no longer be financed from sales, I might be able to bridge this in the short term, but not for months." Due to the unpredictability of the global economic situation, he made the decision early with a heavy heart to retire so as not to get into heavy debt.
The corona crisis affects practically all freelancers. Anyone who has been working on a fee basis for a long time or is used to a patchwork of jobs does not have it easier. This applies, for example, to the teachers at numerous language schools, who were very much in demand only recently. Many freelancers rely on a sufficient number of hours and projects. In the short term, one can make do with small projects, such as providing online lessons and video conferences. But it is questionable whether the freelance projects are still being paid for by companies. Numerous projects have simply been cancelled - with dramatic consequences for the freelancers.
It also affects many small entrepreneurs, such as dance schools, which have often built up an existence over the years with courses, performances and regular dance events. Some are currently keeping their dancers afloat with fundraising. It does work – but how long? There is even the website gofundme.com for this idea.
In addition to these creative ideas born out of immediate need, companies can now apply for help from the government. In this way, small business owners like us may be able to meet our payment obligations and maintain our businesses for the short term, in spite of drastically reduced income.
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This article was published in the Australia Freelance Market News 10/2020.