Should U.S. web workers look East for work?

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In the U.S., debt ceiling talks are providing a white knuckle ride to those following the run up to the August 2nd deadline, while over in Europe the crisis swirling around the euro continues to mutate and grow. All this economic uncertainty is clearly making trouble for politicians, but is it an opportunity for the savvy American web worker with tech skills?

U.K. site which, much like U.S. sites Elance and oDesk, connects talented pros with companies in need of assistance on a per hour basis, has evidence that this might be the case. The site has experienced a dramatic spike in billing from U.S. tech talent working for European clients, including:

  • A 129 percent rise in U.S. invoicing in the last three months versus the same period last year.
  • A 321 percent increase in U.S. freelancer signups over the last 12 months compared to the previous 12 months.

What’s behind these increases? We spoke to Xenios Thrasyvoulou, the founder and CEO of PeoplePerHour who offered three explanations for the boom in U.S. tech freelancers selling their services overseas:

  • The exchange rate. Simple math is one reason U.S.-based freelancers are looking to the U.K. and Europe. “The average rate is, in fact, higher now in the U.K. because of the exchange rate, so they can get paid more,” said Thrasyvoulou.
  • An export premium. Not only is the exchange rate boosting the pay of many U.S. tech freelancers, but the cachet of cutting-edge American knowledge also works in their favor. “They can demand a premium because they are essentially exporting something you can’t get locally. Users here are willing to pay that premium because, as far as they’re concerned, they’re getting best practice.”
  • The type of work on offer. Much of the interesting work at tech companies in the U.S. is done in-house, often leaving the donkey work for the freelancers, according to Thrasyvoulou. But in Europe, American freelancers are setting the pace. “Unlike Silicon Valley where they may be outsourcing the duller parts of their work, it’s the other way around when you’re working with companies in Europe, because you’re essentially the one teaching them what best practice is,” said Thrasyvoulou who sees the intellectual challenge of work in Europe as one of the biggest draws for U.S. web workers. “I think generally innovative, techie people like being at the forefront. They want to be the ones dictating how things should be as opposed to being told how to do things.”

So, is this surge in interest in Europe as a destination for web worker tech pros simply an artifact of the current exchange rates, or will the attractive conditions continue for awhile? Like the rest of us, Thrasyvoulou has no macroeconomic crystal ball and can’t predict how currencies may fluctuate in the future, but he does think the fundamentals of Europe’s tech scene mean that freelancing here there will remain appealing to U.S. talent. With Europe slightly behind the U.S. in many areas, demand for the best freelancers will continue.

“There’s a lot of catching up in the tech space in the U.K. and generally in Europe, and companies are looking out for best practice, which tends to be in the U.S. So there’s a lot of demand for great user experience designers, developers, coders, digital marketers, etc.,” said Thrasyvoulou.

And Europe may not be the only increasingly promising market for American tech pros to sell their services. Not long ago India was exporting simple services to the U.S., but Thrasyvoulou sees the East as moving towards importing more services as well.

“You have an SME sector being developed in India for the first time and all these companies are now looking at developing technologies, websites, from simple to complex stuff. So the tables have turned. Where five years ago they were the ones exporting to the U.S. on a service level, now it’s actually them saying, ‘guys, we need to understand what user experience is. We need to make things look pretty and step up.’ They will turn to the West to hire best practice.”

Tech freelancers speak up: are you looking to Europe (or further East) for a better market for your talents?  

Image courtesy of Flickr user Andres Rueda

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Lou Covey

I’ve been working for so many European companies for almost a decade to the point that rarely take assignments from US companies, all of which are constantly trying to push down the price. It’s not been a bed of roses though, as about 10 percent of Euro companies renege on agreements or fail to make the final payment, so up front pricing is a requirement. UK companies are invariably a more positive outcome, however. The further east you go the more likely that you’ll encounter financial issues.

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