Is GenAI threatening online freelancing?

The triumph of generative AI (GenAI) in the labor market undoubtedly offers potential for more efficient work and, as a result, higher economic growth. However, employees often fear for their job security and find themselves confronted with new challenges. Now, DIW Berlin has taken a closer look at the impact of GenAI on online freelance work—i.e., work that often consists of easily automatable tasks. The study is based on data from various online platforms such as Fiverr, whose orders were evaluated from 2021 to 2023.

The order figures from selected online platforms and labor markets initially show that the demand for easily automatable activities is significantly lower than for other tasks. Writing and graphic design work, for example, can be performed by ChatGPT, DALL-E, Midjourney, or Stable Diffusion and is therefore easily replaceable. Accordingly, the number of orders declined by up to 30%, especially for writing tasks such as proofreading, ghostwriting, or editing. The study also estimates that this decline has intensified over time – since measurements began in November 2022 – either due to increased interest in GenAI or the release of better AI models.

However, demand for such activities has not fallen to zero. The study also examined the nature of the remaining jobs: effects can be observed, for example, in the complexity of the activities, which has increased significantly. In addition, the number of applications from freelancers for a job is increasing and the remaining jobs are better paid (probably also due to the increased requirements).

The study concludes that GenAI has led to greater competition and a short-term decline in earning potential in the freelancing sector. However, the medium- and long-term effects on this sector – as on the labor market in general – are still difficult to assess. Further education and training are now important for both employees and companies in order to maintain competitiveness and give all employees equal access to GenAI.

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