Freelancers or independent professionals have proven to be cost effective options for businesses because they have specialized skills and are able to work remotely
The Covid-19 pandemic has caused economic disruptions to varying degrees from the outset. It has weighed on industries around the world with companies bearing the brunt as they continue to downsize and stall their expansion plans.
The slowdown in activity has required a shift in survival strategies for many smaller businesses, particularly through the introduction of hybrid business models to manage infrastructure, processes, and their staffing needs. Companies have started to use outsourcing services and are working with independent consultants and freelancers to stay competitive and maintain operational efficiencies.
The move to mass remote work has resulted in companies reassessing the structure of their workforce and giving them flexible access to skills. Hence, the current crisis has opened up a number of exciting opportunities for entrepreneurs to develop across new industries and offer freelance solutions to meet pent-up demand from businesses and industries alike.
Freelancers or independent professionals have proven to be cost effective options for businesses because they have specialized skills and are able to work remotely. In the midst of the pandemic, freelancing remains a goal as remote working becomes mainstream. Organizations can attract experts who can be productive almost instantly and who have specialized skills to maximize value.
The GCC is the prototype for this business model, with a high level of entrepreneurial activity across the region. Countries like Saudi Arabia and the United Arab Emirates are fast becoming hubs for analytical and technology-driven companies, encouraging more individuals to get into business to boost the economy.
With the onset of Covid-19, this activity got a boost as lockdowns forced physical facilities to close and large companies poised to facilitate long-distance shifts and investigate working with independent workers. Accordingly, working remotely and working from home has taken center stage, paving the way for new business models and bringing a variety of freelance opportunities with it.
Significance of the freelance activity as an entrepreneur
A survey conducted in the Mena area in June 2020 found that 79 percent of respondents were in favor of virtual communication prospects, while 89 percent were confident that companies prefer independent and remote work from employees, and reiterated the importance of freelancers in the area. The decreasing need for large physical offices and work areas has also lowered the cost burden for people trying to start a business. This in turn is driving the trend towards remote working and offering freelancers attractive prospects for future growth.
The UAE has been particularly familiar with the importance of self-employment by entrepreneurs and has accordingly implemented measures to promote their role in the economy. The country’s favorable business climate is enhanced by a framework of targeted incentives such as corporate and income tax exemptions, low trade import tariffs across the board, legal security, currency stability, limited government intervention, and more offered by local governments. The focus on investing in infrastructure and technology, as well as the goal of attracting foreign investment, make it an incredible launch pad for doing business.
The UAE have appointed a Minister for Entrepreneurship and SMEs, while their incubators and accelerators provide the skills, strategies and strengths needed to commercialize innovative ideas by turning them into a viable business.
Attract global freelance talent
In addition to a number of initiatives in recent years, the UAE has relaxed several regulations to attract freelance talent worldwide. The government has changed rules to make freelance work visas more affordable and new laws have been passed to extend long-term residency visas to eligible candidates and allow 100 percent foreign ownership in a variety of sectors.
In terms of funding, the Abu Dhabi government took an important step in April 2020, allocating 15 percent of procurement spending and annual contracts to micro and SMEs from 2020 to fuel their growth and secure them as the “backbone of the economy”. The government also implemented measures for small businesses, such as the suspension of bid bonds and the waiver of performance guarantees for projects worth up to Dh50 million, which were introduced from 2020 for MSMEs and entrepreneurs from the Emirates.
Licensing initiatives have also been launched, with Abu Dhabi announcing freelance licenses for 48 business activities including legal, real estate, human resources, architecture and fashion design to keep the labor market agile.
Growing market for freelancers in the UAE
A UAE freelancer can now apply for and obtain a permit online, reducing the paperwork and legal requirements required to register a license, as well as accessing various subsidies and schemes to do business in the country. This makes it easier for individuals to explore alternative sources of income and contribute to the overall economic recovery.
As a direct result of these efforts, the UAE freelance market is booming, reflecting the trend in world markets. The nation is seeing more freelancers in software development, websites, cell phones, design, media, and architecture. With a male to female ratio of 1.63 in the UAE freelance workforce, a large majority remain in the young age group of 21-30, indicating the great potential within the space. Communities and platforms like Fiverr, Upwork, TopTal, Freelancing.com, Xpertin, Marketplace.ae and Bawabba bridge the gap between freelance talent and companies that need expertise. Some platforms allow freelancers to publish their portfolio and bid on projects.
Dubai encourages entrepreneurship
Dubai, which promotes many economic and creative free zones to encourage entrepreneurship, remains the most popular freelance location with over 65 percent of freelancers in the UAE, followed by Abu Dhabi with around 16 percent and Sharjah with 13 percent. The growing demand for creative roles like graphic design, web design, content writing, editing, photography and videography, or even functions like social media management, marketing and accounting should further improve the prospects for growth.
After the pandemic, businesses across the GCC and across the Mena region will continue to see a shift away from traditional working methods and adapt to the new normal with improved and evolved business models. As a result, the attractiveness of freelance work will grow over the next few years in line with growing trends in skills and expertise development, remote working, and the growing demand for outsourcing and consulting services.
The combination of these factors, coupled with the area’s exciting incentives and thriving business climate, will continue to attract freelancers who can contribute to overall economic growth. At the same time, investors are increasingly interested in investing in freelance startups as the segment becomes the main framework.
Shailesh Dash is an active entrepreneur and financier. The views expressed are his own and do not reflect the newspaper’s policies.