Several factors will shape freelancing in 2025:
1. AI & Freelancing: A shift in work, not a replacement
AI is transforming freelancing, not eliminating it. While automation is reducing demand for routine, repetitive tasks, it is increasing demand for strategic, creative and highly specialised expertise.
For instance, AI-powered tools now handle basic content writing, data processing and design elements, meaning freelancers in these areas must specialise or upskill.
At the same time we are seeing a rising value of human expertise. Undoubtedly, AI still struggles with complex problem-solving, creativity, and strategic thinking, making freelancers with unique insights, critical thinking and industry expertise more valuable.
Therefore, AI as an enhancer, not a threat and successful freelancers in 2025 will use AI to boost efficiency:
Freelancers who integrate AI into their workflow will have a competitive edge, while those resisting it may struggle.
This topic will be extensively discussed at out upcoming event with Le Wagon on Thursday 13 of February. If you are interested, register here.
2. Policy & regulation: what is changing?
In 2025 Employer NICs will rise from 13.8% to 15%, and the lower NIC threshold will drop from £9,100 to £5,000, increasing costs for freelancers operating through limited companies and subcontractors. As businesses face higher employment costs, some may reduce headcount or cut freelance budgets to manage expenses.
Under new HMRC reporting rules, freelancers may soon be required to declare their self-employment start and end dates, increasing scrutiny of employment status and potentially affecting tax liabilities.
From April 2026, tax and NIC responsibilities will shift from umbrella companies to recruitment agencies or end clients, aiming to improve compliance and transparency. This change may increase costs for agencies and clients, potentially influencing hiring practices for contractors.
As freelancers continue to lack the workplace protections and benefits that employees enjoy, one question remains - will 2025 bring progress in this area?
Several initiatives have already emerged to bolster freelancer support. In 2024 key industry organisations collaborated to form Action for Freelancers (AfF), aiming to improve working conditions and deliver tangible outcomes for the self-employed. Additionally unions like Bectu are actively engaging with industry and government to advocate for fair pay, safe working conditions, and access to training for creative freelancers.
3. Fluctuating client demand
In 2024, 51% of freelancers reported income irregularities, with 34% struggling to find new clients. The UK freelance market in 2025 will likely see a mix of opportunity and challenge:
- More businesses will turn to freelancers – with economic caution leading to fewer full-time hires, companies may increase project-based hiring to maintain flexibility.
- Tighter budgets could lower rates – the average day rate for UK freelancers increased from £457 in Q2 2024 to £576 in Q3 2024, but businesses facing higher operational costs may negotiate lower freelance fees or delay projects.
4. Financial security & late payments: a persistent challenge
Despite government discussions around stricter late payment laws and the introduction of the Fair Payment Code (FPC), enforcement remains weak. In 2024 71% of freelancers experienced late payments and 72% faced client ghosting, a trend likely to persist in 2025.
Freelancers will need to negotiate upfront payments or phased invoices to secure cash flow. They should consider using digital platforms offering cash advances and push for stronger freelancer protections in policy discussions.
Beyond chasing payments, freelancers should also take a proactive approach to financial well-being, planning their income flow, savings and emergency funds to manage the unpredictability of self-employment. Without structural changes, financial instability will remain a top challenge for freelancers in 2025, making careful financial planning more important than ever.
Malt has partnered with several providers to help freelancers with financial security and freedom. Check our partnerships page and get access to exclusive deals.
5. The rise of value- and project- based pricing
The traditional hourly rate model is being challenged as more freelancers and clients explore outcome-based pricing models.
- Some turn to project-based pricing – a fixed fee for an entire project, offering cost predictability for clients and rewarding freelancers for efficiency.
- While others choose value-based pricing, based on the client’s perceived value of the work, that allows freelancers to charge more for high-impact projects (e.g., if a campaign generates £100K in revenue, the freelancer’s fee reflects a percentage of that value).
In 2025 we will see more freelancers adopting these pricing models to gain greater control over their earnings and move away from the limitations of hourly billing.
6. Freelancing & Mental Health: a growing crisis in 2025?
According to a recent survey by Leapers, a UK organisation supporting the mental health of freelancers, 45% of freelancers saw their mental health decline in 2024, with 72% experiencing ghosting and 71% chasing late payments. Freelancers are also three times more likely to experience loneliness than the national average.
Despite the growing number of freelancers in the workforce, they don’t have access to workplace initiatives, HR policies, and legal protections available to employees. With fewer formal support systems in place, freelancers may find it harder to navigate work-related challenges, which can contribute to increased stress, uncertainty, and feelings of isolation - key factors affecting mental well-being.
In 2025, we hope to see organisations prioritise freelancer well-being by ensuring fairer payment practices, offering professional development opportunities and fostering inclusive work cultures. By committing to timely payments, providing access to training resources and integrating freelancers into company culture - through communication, feedback and recognition - businesses can create a more supportive environment for their freelance workforce.
Key takeaways for freelancers in 2025: