Compensation Issues, A Threat To The Creator Economy: Study

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Tipalti, the automated global payables solution, released a new study on the future of the Creator Economy and the challenges creators face as the industry matures.

According to a survey of 750 creators, while a majority of people would like to pursue content creation as a full-time job, industry challenges such as being fairly and quickly paid for their work prevent them from doing so, which may ultimately impact the industry’s ability to scale.

Tipalti’s report, conducted in partnership with Wakefield Research, identified that creators are optimistic for the future and see growth within their industry over the next five years, but there are common impediments to true prosperity that need to be addressed.

In the next five years, content creators predict growth within their industry.

Many content creators are optimistic about the maturation of the Creator Economy, anticipating an increased appetite for content and the professionalisation of the space.

• More than a quarter of creators (26 per cent) are leaving a 9-5 job to focus on creating content full-time.
• When asked about continued growth expectations within the industry, more than two in five creators (42 per cent) predict companies will directly hire more content creators in the next five years, and 40 per cent predict more people will start their own practice in the same time frame.
• Nearly two in five (39 per cent) predict content creators will establish professional associations to represent their interests, and 38 per cent predict more graduates will pursue content creation as a career.

However, the Creator Economy risks stagnation if it does not address key concerns, including compensation.

While the desire to turn content creation into a full-time gig is there for most creators, major roadblocks are preventing them from making that a reality. The inability to get paid easily is holding back creators and ultimately impacting growth of the creator economy.

• The majority of creators (90 per cent) have experienced issues just getting paid.
• 41 per cent have increased their rate to compensate for the late or incorrect paychecks hassle and 36 per cent have had to hire someone to handle business-related tasks.
• More than two-thirds (70 per cent) of creators agree that administrative tasks such as invoicing and payment prevents them from creating content for a living.
• Nearly 83 per cent of creators are less than completely confident in handling necessary, but complicated administrative tasks entirely on their own.
• More than a third (35 per cent) of content creators predict more people will leave the industry because they can’t make enough money.

The industry needs to identify and incorporate solutions to help creators and streamline experiences.

Organisations working with content creators risk losing talent and brands risk losing content creators due to negative experiences. Ease of use, security, and timeliness are critical to creators as the industry continues to grow. Businesses that offer automated solutions will be able to better capitalise on the opportunities the Creator Economy offers by allowing their creators to focus on content, not admin.

• Nearly three in four (72 per cent) creators who earn revenue for content other than that which they create for their employer say automatic payments are important to growing their business.
• The biggest obstacles creators face when dealing with getting paid include receiving payments from multiple platforms (30 per cent); the time required for invoicing, tracking payments and resolving payment disputes (33 per cent); being uncertain on how to fully monetise it (32 per cent); and the tax implications of setting up a side business (32 per cent).
• When it comes to choosing a payment platform, the most common “must-have” is secure payments: it is the top requirement for more than one in five content creators (21 per cent and in the top three for 50 per cent.
• On-time payments is the second biggest requirement, with 47 per cent of content creators listing it in their top three.

“With Covid and the Great Resignation, more and more people started to look at content creation as more than just a side-gig and saw the potential for it to be a full-time job. However, more than 80 paper cent of content creators surveyed identified they are not confident they can handle invoicing and payments on their own, stopping them from making the full-time leap into the Creator Economy,” said Paco Sure, GM of Global Partner Payments at Tipalti.

“Now’s the time for the platforms that creators work with to invest in modern automated payable solutions to alleviate these concerns for creators and ensure the Creator Economy continues to grow rapidly.”