While freelancing poses its own challenges, such as unclear positioning and isolation, treating it as a business from the start can forge a sustainable and rewarding career.
Layoffs are rarely just about losing a paycheck. They can feel like a loss of identity, routine and stability, and for many professionals, they trigger a period of shock, grief or even anger.
But here’s the other side of the story: Layoffs have also become one of the biggest gateways into freelancing. What looks like a career setback often turns into an opportunity to build a more flexible, self-directed path.
I know this firsthand. When I was suddenly laid off, I felt blindsided. But that experience pushed me to try freelancing, and 13 years later, it’s become the foundation of a business I never could have imagined at the time. In fact, when I was laid off again in 2024, this time from a high-paying remote role, I turned back to freelancing full-time and scaled my business back up.
While it’s certainly true that freelancing carries its own stability risks, the experience of losing my source of income in 2024 taught me that I’d rather be in control of creating my own paycheck. It took me seven months to rebuild my business after that layoff and in many cases, I kicked myself throughout that for “trusting” that full-time role.
So why do layoffs so often lead to freelancing? And what can professionals do to make the transition sustainable?
Related: Why a 260% Jump in Freelance Hiring Signals Changing Times in North America
The numbers tell the story. In the past five years, U.S. companies, particularly in tech and startups, have carried out multiple rounds of mass layoffs. At the same time, the freelance workforce has surged, now making up over a third of the American workforce. While tech obviously has lots of pathways into freelancing, it’s not the only sector from which people can make a pivot into freelance work.
That’s not a coincidence. When people are laid off, freelancing is often the most accessible next step. It doesn’t require waiting months for job applications, interviews, and rejections. Instead, it allows you to immediately monetize the skills you already have.
And while many start freelancing as a stopgap, a growing number find it offers more income security than a traditional job. After all, if you lose one client, you don’t lose your entire income stream, which is a major psychological shift after the experience of being laid off.
Layoffs are emotional. Online communities like Reddit are filled with stories of professionals who describe feeling embarrassed, lost or angry after being let go. Many also mention how difficult it is to navigate unemployment benefits or re-enter the job market. In fact, 73% of professionals say layoffs have made freelance work more appealing, while 64% have lost trust in traditional full-time roles, according to A.Team’s 2024 survey.
But here’s the turning point: freelancing allows you to regain a sense of agency. Instead of waiting for someone else’s HR department to decide your future, you get to choose who you work with, what projects you take on and how you structure your day.
That shift from “something was done to me” to “I get to decide” is one of the most powerful mindset changes freelancers experience after a layoff.
Related: How Laid-Off Corporate Workers Are Becoming Free-Thinking Entrepreneurs
Freelancing isn’t just a backup plan. It actually fits the moment in three key ways:
Of course, freelancing isn’t a magic cure-all. New freelancers often hit roadblocks such as:
These challenges are real, but they’re also solvable. The key is to treat freelancing as a business from day one, not just a temporary hustle.
If you’ve recently been laid off and are considering freelancing, here’s a framework to get started:
Related: There’s a Major Shift Happening With Independent Workers — and Business Owners Who Ignore It Are at Risk
I often tell freelancers this: The scariest moment can become the most liberating.
A layoff is a shock, yes. But it’s also a reset button. It forces you to ask: What do I really want from my work? How can I design a career that protects me from this kind of instability in the future?
For me, freelancing wasn’t just a way to replace my paycheck. It became a way to build a career with flexibility, autonomy and resilience. And for many professionals facing layoffs today, freelancing offers the same opportunity. What begins as a setback can become the start of something far more sustainable.
Final word: If you’ve been laid off, freelancing may feel like a leap into the unknown. But it’s also a chance to turn your skills into your safety net, and maybe even into the business you were meant to build.
