UPWORK — the job auction that really sucks!
while you’re running your hamster wheel like a fuckwit!
After months of flailing around on LinkedIn — that corporate cathedral where hope goes to die, only to reincarnate as despair — I decided to try a different platform. One that also promised an ocean of possibilities to those in the ‘deluded but desperate’ demographic. A.k.a. “too cynical to hope, too broke to quit”
Yep, I registered with Upwork.
Along with 18,000,000 other hopefuls!
Eighteen million people lining up to get paid by strangers for the same piece-work that almost every other freelancer is competing for.
By the way, a third of those 18 million are software developers. My condolences to you guys. Unless you’ve got ten years’ experience in Carbon or Mojo — two languages younger than your espresso — I really don’t know how you get yourselves noticed.
So, I created my profile, picked a handful of dubious skills from a list about as empty as a Christmas chocolate box, and uploaded an equally dubious photo. After drafting, in fewer words than the competition, exactly why I’m unicorn shit, I got ChatGPT to polish it into something Steve Jobs would have been proud of. Loaded with bullet-pointed “can do’s and have done’s”.
So far so good. I was almost excited!
I had a bit of an issue changing from USD to EUR, with every help screen a fairy tale of directions to buttons that didn’t exist, so I left it in USD. Also, somewhere along the way my laptop developed a virus — rebooting every 5–10 minutes. Coincidence? Perhaps. But it started right after registering the account.
Anyway, overlooking the continual reboots, I was hit with a large red box flashing ‘Verification’. It seems you had better get yourself “Verified”, Upwork urges, if you want visibility. Fine, I thought. Let’s go balls in.
Follow the instructions, scan a QR code, take a picture of your Govt. ID — not so easy in an app designed by someone with Orientation Deficit Disorder. On the eighth attempt, the laptop rebooted three times in a row and I abandoned verification altogether.
Deciding that my Cognitive Divergence Quotient had been maxed out, I deleted the account. “Too difficult to work with”, I told them at the exit interview.
But not before I’d had a general nosey around and a good look into the dubious ways in which Upwork charges for its ‘service’.
Let’s take a look at that.
- For Starters: Upwork’s subscription system — Freelancer Plus.
This is the cash cow at $20 a month, and it’s essential if you’re going to pretend you’ll make money. Well, that’s what they tell you.
It’s basically the same as every other system — a monthly subscription fee — but mildly absurd in the case of Upwork. Think membership fee at your local café, but you still pay for the almond latté and croissant — I’ll explain in a moment.
2. The Main course: Commission!
Everyone’s heard of it, no one likes it. And in Upwork’s case, they’re squeezing the toothpaste tube from both ends.
Upwork take 10% from you, the poor hopeful freelancer, and then charge the employer another 5% on top. So, 15% of the price of the job goes to the platform. For doing basically nothing — given that it requires about as much developer intervention for the 1,000,000th job posting as it did for the 100th.
3. And for Dessert? Pay-Per-View.
Or Pay-to-Compete if you want a more accurate description. Upwork calls it “Connects”, the pièce de résistance — the icing on the croissant, the cinnamon dusting on your cappucino. Dreamed up by the bankers at the PE firm that issued the seed capital, this is where the real fraud is hiding.
‘Connects’ are tokens you buy just so you can respond to job offers. That’s right, entry tickets for the game you’re not even going to win.
And the fraud part? Upwork set the going rate of ‘Connects per gig’, a.k.a. the entry price, based on their perceived value for that gig. Yep, you read that right. The number of Connects you throw in the ring, along with your hat and the last remnants of your pride, is set by Upwork themselves, not the employer.
Like, how do they know what a job is worth to anyone. And why should you have to pay to compete when you’re already paying a monthly subscription, AND they’re gonna take 10% off you if you get lucky?
Oh, and if that’s not enough, the higher you bid, because let’s call it what it is — an auction, the higher up the ladder Upwork might bump your proposal.
So, let’s just recap. To play in this freelance roulette:
- you pay a monthly casino membership to walk in the door,
- a fee to sit at the table and probably lose,
- and if by some miracle you happen to win, the house takes 15%.
Sound fair?
I didn’t think so either.
God forbid some of the jobs displayed aren’t even real!
Who said that? I mean, come on, that would be saying Upwork are making you buy Connects to bid on jobs that don’t even exist! Oh, and don’t forget to carry on paying your monthly subscription in the mistaken belief that tomorrow, maybe tomorrow, you’ll get your dream gig.
Some facts and figures
Upwork doesn’t disclose how many jobs actually get awarded versus how many freelancers are throwing their hats in the ring. But figures available from Upwork state that US $3.8billion was paid out in 2023 for work done. Which, if shared equally, would net each freelancer just over $200 for the year. But of course, we know that the vast majority of talent earn nothing at all and a few do quite well.
Just how few, and just how well — we have no idea.
We also have no idea if the figure of $3.8billion is even accurate, given there is no way to check it.
Similarly, we know very little about the number of active ‘jobs’ at any one time. Upwork, of course, doesn’t make this sort of information available, but one thing we have been told in the Upwork 2024 report, is that:
about 38 % of “closed projects” resulted in a hire — a ‘successful contract’
THIRTY-EIGHT PERCENT!
Is that it?
Fewer than 4 in every 10 jobs actually get awarded?
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Community anecdotes suggest the real-world conversion of “job posted → freelancer hired” is as low as 10 % or less in certain categories.
So, 18 million freelancers are paying good money they don’t have, to bid for work that is apparently being offered by genuine companies, but we only get a match 38% of the time.
That begs the question — what’s going on with the other 62%? Or 90% in some work categories.
- Did the companies just change their mind?
- Did Upwork set the ‘entry price’ so high that no one bid?
- Were none of the 18 million desperate enough to pawn their remaining pair of Havaianas to buy a few more Connects?
- Maybe that $5/hr pay rate didn’t tickle the talent trout out from under their keyboard long enough to make a bid. Or the talent set the price-tag on their remaining ounce of self-worth at an eye-watering $6 an hour — and didn’t bite.
Scary thought alert: Did the job even exist in the first place?
Who said that?
I decided to do a bit of snooping through the jobs that came up on my dashboard. This is what I saw:
- 50% of employers have never paid a freelancer. Ever.
- 25% have spent pocket change in the last year.
- 25% account for the 3.x billion dollars of business. Astropheric numbers in some individual cases.
Some employers actually seem to run multi-national empires through Upwork alone!
I saw one company that had spent more than half a million USD in two years, on freelancers, paying for 83,406 hours of work at an average hourly rate of $5.97.
You read that right — $5.97 an hour.
They currently had 4 open jobs: a Chief Operations Officer, a Chief Marketing Officer, a Chief HR Officer and an IT Consultant.
You better hope the $5.97 didn’t include any C-Suite work, or the rest must have been getting around a dollar an hour to bring the average down that far. Not so much a limbo bar as a trip wire.
Question?
Is Upwork, in fact, an employment bank that means some businesses avoid employing anyone on contract — at all. No payroll taxes or social security costs, no maternity or sickness cover to worry about, no holidays or overtime — just a 5% recruitment overhead on top of a ramen rate of pay that covers your noodles and not a lot else.
Interestingly, Upwork has a ‘Modern Slavery and Human Trafficking Statement’ in which they proudly state:
Based on the nature of our business, our geographical footprint, and the limited goods and services we procure, we believe that our operations are low risk with respect to modern slavery and human trafficking practices. Our workforce is primarily made up of skilled employees and freelancers, which further supports our low-risk profile.
While that may handsomely cover the 600 people they directly employ, I would question whether $5/hr or possibly even much lower, doesn’t constitute some form of modern slavery. Let’s leave it at that — you can form your own opinions.
Competition
Let’s look at the competition for these amazingly lucrative offers. You know the ones that’ll keep you from selling half your liver to pay the grocery bill, or pawning your own ego to keep the lights on.
Upwork only gives you the number of ‘other bidders’ who have submitted proposals for a gig, in fixed bands: like 5–10, 20–50 etc. So, you have very little idea how much competition you’re facing, and therefore zero clue how many ‘extra’ Connects you should bid, to try and make it to the ‘visible’ level.
Most postings have dozens of applicants — Reddit suggests 150+ is not uncommon. If you’re in some popular categories, like ‘Full Stack Developer’ — that human Swiss Army knife of programmers — or you’re someone who understands ‘what the hell is going on under the hood of AI’, then I hope your Christmas stocking is rammed full of Connects. You’re going to need them.
TLDR: you spend hours submitting proposals to companies that may or may not exist, for jobs that they may or may not award, in competition with maybe 100 others, for a $200 gig paying maybe $5 an hour.
Maybe you win. Once. Maybe.
Mostly, you grind — your hopes crushed by the algorithmic boot like peppercorns in a Pizza Hut pepper mill.
The Money Machine
Let’s look at this money machine. Upwork is worth almost USD $2billion. Last year, they made a 25% profit on nearly $800 million revenue. An unheard-of % rate in most corporate circles, and about twice the average for Forbes Global 2000 companies.
They are minting money off automated efficiency — the freelancing equivalent of a casino one-armed bandit where the house wins. Every damn time.
Meanwhile, the talent that they ‘support’ scrapes by on fresh air and yesterday’s hope.
One other statistic: Upwork employs about 600 people. That translates to a whopping $1.3 million in annual revenue per employee — twice Fiverr, and nearly as high as Meta, a sprawling corporate empire with far more infrastructure and a much more complex offering. Further evidence of the mismatch between earnings and work done.
Finally…
We’ve talked about the revenue sources, but compare Upwork to a real live human recruitment company and you’ll see the extent of the rip off.
Upwork is charging a monthly subscription + Connects + 15% of every gig. According to their own numbers that’s 21% of the value of work awarded. For an automated jobs board that performs no additional effort!
A Human Recruiter, on the other hand, is actively searching their database, managing pipelines, honing JD’s with their client companies, advertising roles, processing and vetting responses, as well as interviewing candidates. Usually they charge one month’s salary — that’s only 8.3% of a job’s annual worth.
Not 21%. Not 15%. Not 10%.
8.3%
It’s a casino where the house always wins. You play; you lose. You play again; you lose again.
And the jackpot? Upwork’s. Always theirs.
I once heard a saying on Wall Street:
If it smells like a rip off, sounds like a rip off and you feel ripped off — it’s a rip off.
P.S. I wanted to ask Upwork if they could justify their 21% takehome from every $ spent by employers on their platform. Or why only 38% of ‘offers’ result in a contract. Or why freelancers need to bid for work in an ‘auction’, instead of letting their talent or testimonials speak for themselves. Guess what — the ‘Feedback’ link on their website doesn’t link to anything!
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