Study Hall’s 2020 State of Freelance Report Part 1: The $100,000 Question

Development Director Evan Kleekamp reviews trends found among survey respondents who reported six-figure annual incomes in 2020, questioning the merits of online discussions about six-figure incomes found online. 

As Study Hall prepares to publish the findings of our 2020 State of Freelance survey, we wanted to give our subscribers an exclusive peek into the forthcoming report. Over the next several weeks, we’ll publish snippets and musings from our ongoing research, and even pose some larger questions that the survey project is meant to illuminate. For this week’s dispatch, Development Director Evan Kleekamp reviews trends found among survey respondents who reported six-figure annual incomes in 2020, questioning the merits of online discussions about six-figure incomes found online.

Please note that all income data reported below is anecdotal and based on pre-tax income. Out of the 888 Study Hall subscribers who took the survey, 551 provided complete answers to our individual income question set. Of these 551, another 275 provided us with additional information about their total household income, which includes their partner, spouse, or family’s additional income streams.

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Not even a mass death event like the Covid-19 pandemic could slow the aspirations of the American middle class — at least that’s what I’ve gleaned from watching #freelance Twitter last year. Like many of you, I dread seeing the quarterly Twitter threads in which freelance media workers boast about earning six-figure incomes then provide ostensibly useless instructions on how you, a newbie or exhausted freelance journalist, can do it too.

To be clear, I believe it’s possible and even desirable to earn more than $99,999.99 per year freelancing. I also believe that crises can force contingent workers like freelancers into streamlining their businesses or finding new lines of work, which may prove quite lucrative in ways that were not previously possible. But I wish there was more context about the amount of time, labor, and luck (née intergenerational wealth) it takes to build a successful freelance business. Many of the freelancers I spoke to in preparation for this dispatch agreed.

“I made a lot of money last year,” says freelancer Angela Serratore. “But if I had to come up with the top five things that helped, one would be that when my dad died he left me a house in Los Angeles to sell, so I was able to go freelance and chase higher-paying work. Another is that I live with my partner and we split the bills.”

Such disclosures about financial support from family members or partners who share their income or living space are rare. Instead, as Study Hall contributor Brian Ng put it bluntly, the online conversations primarily arise from the ‘coaching crowd.’ Ng says he believes the mythology around six-figure incomes is a holdover from when that was considered a high salary, and that these freelancers are merely performing wealth.

“There’s so much shitty performativism in freelancing that serves only to further obfuscate the field and line the pockets of these ‘coaches.’ Many who’ve had one or two prestige bylines which were commissioned because of factors aside from their talents,” he said.

For many of our subscribers, who we believe are representative of freelance media workers at large, any recurring gains in their income would drastically change their lives. The idea of adding another zero to the end of their income check represents safety, security, and discretionary funds. For those individuals, $100,000 may be the bridge between a freelance hustle and a bonafide, successful small business, even if upon closer scrutiny this analogy falls apart. All the same, we’re curious why freelancers have come to associate this figure with success and what that success actually looks like among our subscribers when there is less opportunity and incentive for good-spirited marketing.

Pushing aside the fact that the $100,000 threshold may be an arbitrary division and remnant of a now-unfamiliar media industry, we think it’s still an interesting measure of how freelancers perceive financial success. Given that most estimates define the American middle class as earners making somewhere around $40,000 and $150,000 per year and that these estimates are likely more accurate and relevant at the state and municipal level, the $100,000 threshold seems to squarely separate the upper middle classes from their other less monied middle class peers.

But the middle class is also a moving target. Even if a worker’s income stays the same, the composition of the broader economy is in flux, which means $100,000 one year may mean something entirely different a few years later. As outlets such as Business Insider have reported, phenomena like widespread increased living costs and inflation have changed how much money workers believe they need to feel financially secure, and the amount of money needed to live the middle class lifestyles of the past is much higher now.

For Study Hall, an online community comparable to a small virtual town whose inhabitants live in different parts of the world but perform similar labor, the survey is an attempt to ask ourselves: Based on their reported income and working conditions, to which financial bracket of workers do Study Hall’s subscribers generally belong? By extension, are those reported income trends and working conditions common among freelance media workers and their employed colleagues? And, if the data found therein is scalable, how should we conduct ourselves to best protect and improve our financial wellbeing as a community of like workers?

VARIATION IN EXTREMES

These questions of scale and proportion matter when we consider how a community defines financial well-being. In our case, that meant gathering quantitative data about income so that we could assess the buying power of our respondents ($28,676,450.50) and isolate how much freelance income ($14,402,268.50) contributes to that total (50.22 percent). We also wanted to see how many of our participating subscribers made $100,000 not just so we could compare our percentage of six-figure earners to the national average (estimates typically say less than 10 percent) but to shine light on some other factors — such as cohabitation, plural income streams, and familial assets — that could be influencing how people yield higher incomes. (NB: it’s likely that high-earners are overrepresented in our dataset because anyone who feels shame about their income level is less likely to disclose it, even if anonymously.)

While it wasn’t our original intention to use the survey to examine six-figure incomes, once we saw the data and were able to compare income levels, a more difficult-to-tell story began to unfold. Beginning by simply asking ourselves if there are six-figure earners among our subscribers, we then moved to investigating if there is an isolatable, compelling feature that each shared.

Ultimately, the data we gathered about six-figure earners is inconclusive due to extreme volatility. Even if six-figure earners are a recognizable portion of the survey’s respondents (58 out of 551, or 10.53 percent), we don’t have enough data on this grouping to make any claims that warrant immediate changes to your freelance practice, as there is simply too much variation among them. Without a larger sample size, 58 people is simply not enough examples to produce a definitive assessment; we would be imputing homogeneity to a group in which, as the data shows, variation is consistent. For that reason, we’ve provided averages, medians, and standard deviations where variation was notable.

That said, there are some common sense trends that can help reduce any embarrassment or shame freelancers feel for not crossing into the heavens of the upper-middle class. First, the average age of respondents who made $100,000 or more was 39 (±9.41) with the median age (38) confirming that figure. These respondents typically had about 13.5 (±7.16) years of experience working in the media industry and 14 (±6.06)  years of employment regardless of industry — and the comparative medians for these values are relatively commensurate at 12 and 13 years respectively, suggesting that, if our data can be trusted, those with six-figure aspirations should expect to grow their business for at least 6 to 7 years.

By comparison, when taken altogether, respondents reported about 8 (±5.91) years of media experience and about 9 (±5.23) years of total experience on average, with respective medians likewise falling at 7 and 8 years. When excluding $100,000 earners, those experience averages remained about the same: 8 (±5.63, median 6) years in media and about 9 years (±5.63, median 7) in total experience. So younger freelancers and those with less than 5 years of experience, please note that while income variation is significant, age and experience vary to a lesser degree.

The highest income reported by a Study Hall subscriber who participated in the survey was $400,000, but the highest reported income for a spouse was $500,000. (It should be noted that 4 of the 7 top-earning respondents, all who claimed to earn $200,000 or more in 2020, attributed their income solely to their freelance work. We did not track whether reported secondary incomes for partners or family members were from freelance work or employment.) From there, 58 out of the 551 respondents who provided individual income information (10.53 percent) said they made $100,000 or more (including non-freelance income) in 2020. Within that group of 58, 20 respondents (34.48 percent) said they made their six figures exclusively from freelance, 35 (60.34 percent) said mixed employment and freelance income helped them make six-figures, and 3 respondents (5.17 percent) said their job paid them six-figures. (We’ll further distinguish mixed-income media workers in subsequent dispatches.)

Of the 58 who reported that they made six figures, 42 (72.41 percent) identified as female, 11 identified as male (18.97 percent), 2 (3.45 percent) identified as nonbinary, and 3 (5.17 percent) preferred not to disclose information about their gender identity. But we also know from our onboarding tools that most Study Hall subscribers are women and that most respondents to the survey were female as well. Most respondents who reported six-figure incomes, 48 (82.75 percent) out of the 58, identified their race as white. The remaining 10 either preferred not to disclose their race or represented one of the many non-European races, but none of these presented a uniquely frequent minority.

More than half the respondents (31 out 58, or 53.44 percent) making six figures said they lived with their partner, but only 14 out of 58 (24.13 percent) said their partner’s income contributed to their livelihood. This last trend also made us wonder if we should add further survey questions that prompt respondents to clarify whether they believe their live-in partner contributes to their general livelihood and not just to their ability to receive more income.

32 (55.17 percent) out of the 58 six-figure earners said that freelancing was their primary income source. By comparison, 454 out of the 888 sum respondents (51.12 percent) said freelancing was their main gig — so nearly the same percentage. But for any of these data points to mean anything concrete, we would need a much larger batch of respondents who made over $99,9999.99.

Out of the total 888 respondents, 92 (10.36 percent) reported someone else in their household making six figures. Whereas confined to the 58 respondents who made six-figure incomes, 13 (22.41 percent) said their partner, spouse, or another family member added over $100,000 to their household income. (But remember, many of these households with one or more high-earners also have children or elderly dependents — higher household earnings may indicate pooled income streams with various dependent members of the family contributing.) The reality is that most respondents (63.32 percent) made less than the average income, $52,044.37 (±$40,507.14), and that the median independent income, considered the more valuable measure for comparing widely varying incomes because it is absolute middle of a set, among respondents is only $40,000. When assessing average and median individual income among media workers who exclusively made their income through freelance work, those values dropped to $50,470.54 and $37,000.00 respectively, with the standard deviation slightly increasing to ±$47,159.07. Likewise, when excluding six-figure earners, the average income fell to $41,905.12 (±$23,420.99), showing significantly less variance and a lower median income, $38,000.

But before anyone gets too excited, let’s return to that first standard deviation figure (±$40,507.14) and the gaps between average and median income. Here, the standard deviation suggests that among all respondents, individual incomes, whether from freelance wages or salaried employment, varied by a degree that exceeds the median ($40,000). In other words, there was extreme variation among reported incomes as respondents claimed incomes both substantially above and substantially below the average and median. But these figures also give us the most indicative sense of the income volatility freelance media work entails: freelancers can make a lot of money or barely scrape by.

Meanwhile, respondents with a spouse, partner, or family member who provided an additional household income stream reported on average $58,436.95 (±$82,140.43) in additional income to their household, with the median income clocking in at $30,000.00. By comparison, respondents who reported earning a six-figure income reported additional household incomes averaging $79,351.92 (±$90,127.55), with the median secondary income clocking in at $64,500.00. In each case, the additional household income averages exceed the respondents’ own income averages. But the standard deviation figures indicate that variation among additional household income is even more extreme than variation among individual income responses, with some additional household income sources outearning their peers several times over.

On a final note, to put these Twitter conversations in perspective, only 4 people (7.14 percent) out of the 58 six-figure earners reported that they were in their twenties. So while earning six-figures unaided is possible, there are probably other major deterrents that prevent most people from entering the upper middle-class unless they were already there to begin with.

There is also another glaring issue with our data: we are still in year one of our longitudinal study, which means it’s quite possible that the 2021 dataset will be entirely different. Some freelancers who made six-figures in 2020 might have found themselves struggling to repeat such returns in 2021. Or, as many respondents suggested in their anecdotal responses to our open question about how the pandemic affected their freelance practice, 2020 could have been a surprisingly remunerative year. “The pandemic actually improved my business,” as one respondent put it succinctly.

Moving forward, it’s best to keep realistic expectations in mind: lacking years of experience, a freelance media worker’s best bet is to have some outside financial cushioning that makes chasing bigger, more lucrative gigs viable. But, as Serratore cautions, freelancers who aspire to make $100,000 should be skeptical about the labor it entails. “A lot of the ‘I made $100,000’ tweet threads treat that number like you get there and then you’re going to make that much money forever,” she says. “I think that is very dangerous as a message to send to people who aren’t there yet.”

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