The Freelance Economy
Our economy is currently in a state of flux, dramatically altering the landscape of traditional business, commerce and trade. Ultimately, this historic period of change is reshaping the American work-force, yielding a completely new vision of modern employment.
One of the biggest changes is the effort many companies are making to operate as lean as possible; with the goal of lower their overall costs. The fewer number of full-time employees, the less a company pays in employment tax, social security contributions and health care costs.
Instead of operating with a large, dedicated staff, companies are maintaining a limited staff, and increasingly hiring freelance workers to handle specific or specialized tasks on an as needed basis. Freelancers are paid as independent contractors (paid under a 1099 Tax Form), releasing employer from the burden of typical human resource costs.
The Freelance Welding Alternative
Perhaps you have been a victim of “downsizing” and been laid off or out-right fired from your most recent welding job (or series of) welding jobs. If you’ve already been laid off, or if you see the writing on the wall in your current position and fear a layoff is eminent, or if you’re just looking for a new and more interesting, and launching your own businesses sounds like a worthy challenge, freelance welding may just be the right options for you.
The following is list of five basic tips to help guide on the path to launching your own freelance business:
Minimum Requirements
Ideally, to be successful, i.e. actually get hired for available freelance jobs, you should be a certified welder, with at least three years of practical experience. Obviously, the more experience the better, as you’re more likely to be hired by a larger number of companies, for a wider range of assignments. But with anything less than five years of on the job experience, many companies will be reluctant to hire you for fear you lack the required skill and expertise.
Marketing
A resume (with references) and business cards are the bare minimum necessary to market yourself as a welder, but in this day and age, a website is a proven and highly effective marketing tool. Almost everyone in business today has a website, and with all of the do-it-yourself templates, it’s not the difficult to set up your own site.
Gathering email contact information for the companies you would like to work with, or companies who you feel could benefit from your freelance services, and sending them a mass emails offering your services is also a very effective marketing tool.
Cold calling these same companies is another viable option.
In both cases, do a little investigation (whether online, through industry contacts, or just calling the companies directly) and find out who’s in charge of hiring freelancers, and forward your emails and phone calls to that individual or department.
Networking
Essentially a form of marketing, networking is an indirect promotional approach, intended to get your name out there as potential freelancer. Get in touch with welders and other industry contacts, let them know you’re freelancing now, and currently looking for work. Email them your resume and send them some business cards (and a link to your website if you have one). You never know who might have connection for a freelance project that you’d be perfect for.
Insurance
As stated above, many companies use freelance welders to limit costs—health, disability and workers compensation—being their chief liabilities. This means you need to purchase your own insurance. Health insurance is very important, particularly to cover major injuries and significant illnesses. You should also have some type of disability insurance coverage in case you’re injured and can’t work anymore. Additionally, many employers require some kind of liability insurance or bond to protect them in case of an accident while you’re in their employ as a freelancer.
Researching and purchasing insurance is vital to maintaining a successful freelance welding career, because without proper insurance, you could end up in financial ruin.
Taxes
Taxes are equally as important as insurance. As independent contractor (paid under a 1099 Tax Form), you’re responsible for paying all of your own taxes, which includes employment taxes (Social Security, FICO, Medicare, etc…).
Ideally you should consult an accountant to determine your estimated quarterly tax returns, and make payments at the end of each quarter. This is always a good idea, because if you overpay, you’ll receive a refund after you file your yearly tax return, but if you under pay, or don’t pay at all, you may be hit with a big tax bill that you afford to can’t pay.
A good rule of thumb is to save approximately 25% of all gross receipts to cover you income and employment taxes.
If you are looking to start or have already started freelance welding, make sure you have all the supplies you need to get the job done. Check out Bakers Gas to see what deals we offer.