In the era of AI, it might be progressively harder for ordinary individuals to earn extra income by relying solely on a single skill.

This may seem counterintuitive. Browse social media today, and you'll encounter numerous tutorials on how to make money using AI. Master a few AI tools, and you can start accepting orders for design, copywriting, video editing, or even website development.

It appears as though AI is lowering skill barriers, suggesting more earning opportunities for the average person. However, recent data from several global freelance platforms paint a less optimistic picture.

In the first quarter of 2026, Upwork, one of the world's largest freelance platforms, openly admitted during an earnings call that AI is affecting small contracts worth $500 or less.

According to data compiled by third-party agencies, project postings declined in 11 out of 12 major freelance categories, including writing, design, and development.

Even transitioning to AI-related businesses doesn't necessarily mean easier earnings. Upwork data reveals that while the number of generative AI and creative production contracts surged by 90% year-over-year in the first quarter of 2026, the average revenue per contract dropped by 13%.

More cruelly (retaining the original tone, though 'cruelly' is the correct form in proper English), the simplest tasks—ideal for beginners—are precisely those most easily replaced by AI.

Data indicates that in the first half of 2026, entry-level projects on Upwork declined by 29.3%, significantly outpacing the overall market decline of 19.1%. Even in emerging AI fields, nearly half of relevant IT and networking projects require expert-level experience.

These figures reveal a stark contradiction: AI makes acquiring professional skills easier, yet earning money from those skills becomes increasingly difficult for ordinary individuals.

The freelance market, once seen as a viable alternative to traditional employment for earning extra income, is now feeling the brunt of this impact.

/ 01 / AI Begins to Disrupt the Gig Economy

Let's first address the question: How exactly is AI taking away business from freelancers?

This is different from corporate layoffs.

When companies adopt AI, they may reduce hiring or even lay off employees. However, the freelance market is more direct—if clients don't need you, they simply stop posting orders.

This is precisely what's happening on Upwork.

In the first quarter of this year, Upwork management highlighted a phenomenon during its earnings call: as AI adoption accelerates, client activity for contracts worth $500 or less has been significantly impacted.

Why specifically contracts under $500? Because these typically involve tasks most easily completed by AI.

Examples include translating a standard document, designing an event poster, writing product descriptions, or making simple website modifications.

These tasks, while not highly complex for professionals, have supported many freelancers earning through skill-based gigs.

Clients who once paid tens or hundreds of dollars to outsource these tasks can now complete many of them using ChatGPT or other AI tools.

The result? Potential orders simply vanish.

Third-party data firm Vollna analyzed over 2.2 million Upwork projects in 2025 and found that project postings declined in 11 out of 12 major categories, including writing, design, and development.

Writing saw a 32% decline, translation 20%, and IT/networking 27%.

Moreover, Upwork isn't the only platform affected.

Another freelance platform, Fiverr, disclosed in the second quarter of 2026 that active buyers decreased by 21.9% year-over-year over the past 12 months, yet clients completing projects worth $1,000+ grew by 13%.

This gap is telling. Clients haven't abandoned outsourcing entirely—they're just increasingly unwilling to pay for simple tasks.

Complex projects still find buyers, while fragmented, low-value one-off tasks disappear.

/ 02 / The Premium on Execution Skills Vanishes

At this point, someone might argue: If traditional freelance work is struggling, why not pivot to AI-related orders?

After all, AI itself creates new demand.

There's some truth to this. In the first quarter of 2026, AI-related work on Upwork grew by over 40% year-over-year in transaction volume.

But here comes another set of data that may disappoint you.

While generative AI and creative production contracts surged by 90% in volume, the average revenue per contract dropped by 13%.

Even more basic AI execution tasks saw revenues decline by 28% year-over-year.

How should we interpret this? I believe a key reason is that AI enables more people to complete tasks, but this ability itself is rapidly losing scarcity.

Take AI art generation, for example. To land an illustration order traditionally, you needed drawing skills, understanding of composition, color theory, and design software—a real professional barrier. Now, many people can generate quality images after learning a few prompts.

The problem? When dozens can perform similar tasks, why would clients pay you a premium?

Signs of intensified competition already appear in the market.

Fiverr surveys show that 63% of its freelancers used AI tools in 2024, rising to 76% by 2025.

Freelancer's 2025 research found that generative AI projects received 1.88 times more bids than average projects.

Everyone uses AI to boost productivity and compete for new AI-generated orders. Ultimately, technological dividends get diluted through competition.

Another shift deserves greater attention.

In August 2026, Upwork research revealed that projects hiring humans to refine and perfect AI-generated outputs grew by 70% year-over-year. Demand in software development and design creativity for such tasks reached 8.3x and 7.9x their 2023 levels, respectively.

What does this indicate? AI is transforming how clients purchase professional services.

Consider creating a children's book. Traditionally, a client might hire an illustrator for character design, scene rendering, and final delivery. Now, they can first generate illustrations with AI, then hire professionals to modify details, unify styles, and format for printing.

Software development follows a similar pattern. AI writes initial code, and clients then hire programmers for inspection, debugging, and refinement. Human work hasn't disappeared entirely, but complete creative projects now fragment into smaller review, modification, and delivery tasks.

To be clear, these post-production tasks aren't necessarily cheaper—complex refinements and quality control can still command high prices.

But for those primarily earning from basic production tasks, the scope of billable work is shrinking.

Thus, knowing how to use AI doesn't automatically mean you'll profit from it. Especially when clients wield the same tools, earning a premium through mere execution becomes increasingly difficult.

/ 03 / AI Dismantles Newcomers' Entry Points

Now comes what I consider the most cruel aspect.

Who suffers most from AI's impact on the freelance market?

Data suggests it's likely inexperienced newcomers. Vollna data shows that in 2024, entry-level projects comprised nearly 15% of Upwork listings.

By 2025, that share fell below 9%.

In the first half of 2026, entry-level projects dropped from 106,485 to 75,268—a 29.3% decline, significantly outpacing the overall market's 19.1% drop.

In other words, while the entire freelance market is toughening, opportunities for newcomers are vanishing even faster.

Why does this matter? For many ordinary individuals, freelance platforms represent the easiest pathway to enter the commercial world after acquiring a skill.

A college student who learns Photoshop can start with $10 photo retouching gigs. A novice programmer can take simple website modification projects to build a portfolio and client reviews. Income may be modest, and skills immature, but at least someone provides opportunities.

After all, nobody starts with a decade of experience.

Yet AI is disrupting this process. The simplest tasks ideal for beginners are precisely those AI can most easily handle.

This creates a problematic cycle: clients increasingly don't need beginners, but beginners must complete real projects to become the experienced professionals clients seek.

Making matters worse, emerging AI fields offer little room for newcomers either.

Among Upwork's IT and networking projects involving AI technology, only about 4% are labeled entry-level, while nearly 47% explicitly require expert experience.

Specific job requirements make this even clearer.

In September 2026, an Upwork AI automation order with a $1,000 budget required API and JavaScript proficiency, at least two years of n8n practical experience, and documented system troubleshooting history.

The following month, an e-commerce brand posted a $2,000 AI video project with explicit requirements: generating videos alone wasn't enough—applicants needed to showcase past advertisements along with metrics like click-through rates and return on ad spend.

You see, AI tools are indeed becoming easier to learn. Yet client expectations for deliverables remain undiminished.

In fact, by reducing baseline production costs, AI makes clients care even more about problems tools can't solve.

This puts newcomers in an awkward position. Learning AI may take weeks, but securing real commercial projects to build client trust and industry experience still requires time.

Unfortunately, the small projects best suited for gaining this experience are disappearing.

AI may take away not just young people's first income but also their initial stepping stone from novice to professional.

/ 04 / Even Veterans Face Challenges?

Does this mean experienced freelancers are safe?

Not necessarily.

Vollna's analysis of 2025 Upwork project quotes revealed that in writing, design creativity, and sales/marketing, the median upper limit of hourly budgets for expert-level projects dropped by about $5 compared to 2024.

Note that these are client budgets when posting projects, not necessarily reflecting actual freelancer income declines.

But at minimum, it shows that even for expert-level skills, pricing pressure exists in some traditional professional services.

However, another set of data tells a different story.

Upwork's 2026 research showed that AI-enhanced professional services saw a 72% year-over-year increase in workload volume and 22% growth in related revenue.

Why do some professionals struggle to earn money with AI while others benefit?

I believe the key difference lies in whether clients are purchasing your labor or your problem-solving abilities.

Upwork shared a case study. Marcus Grimm, a freelancer with over 20 years of marketing automation experience, used AI to increase his concurrent client count from about 4 to 8.

Weekly time investment per client dropped from 10 hours to 5. For some new clients, he even raised his hourly rate by 20%.

How did he achieve this? Because clients paid for his ability to design, build, and optimize entire marketing automation workflows.

They needed him to determine how enterprises should acquire customers, how to design marketing processes, how to connect different tools, and how to adjust when issues arose.

AI could handle repetitive tasks for him, but these strategic judgments still relied on his decades of industry experience.

Thus, among professionals using AI, outcomes diverged.

Those executing standard tasks may lose bargaining power due to AI. Those responsible for complex outcomes can leverage AI to serve more clients and earn more.

Of course, this is just one case and doesn't represent all senior freelancers. But it points to a valuable insight: what clients are willing to pay for is becoming more important than what specific skills you possess.

/ 05 / Conclusion

With the data presented, let's return to the article's opening.

Why do I believe changes in freelance platforms warrant attention from every ordinary person?

Because the freelance market acts as a magnifying glass, prematurely revealing AI's impact on skill value.

In traditional companies, whether a role gets replaced by AI often depends on organizational structures, HR policies, management costs, and other factors.

The freelance market operates more directly.

Clients post orders for what they need; if they deem something not worth the price, they stop buying.

The market quickly provides feedback on whether a skill can still generate income.

These signals point to an uncomfortable reality:

AI may make numerous professional skills widely accessible, but skill accessibility doesn't equate to earning opportunity accessibility.

In fact, the opposite may occur. When creating a poster, translating a document, or writing simple code approaches zero cost, ordinary individuals can no longer rely solely on possessing these skills to secure stable income.

Meanwhile, jobs requiring real experience, commercial judgment, and accountability for results remain highly selective.

For established professionals, this means upgrading capabilities urgently. For young people just starting, the situation appears even harsher.

They haven't yet built experience barriers when facing a market that continuously devalues basic labor.

We often encourage ordinary individuals to learn additional skills as pathways to extra income.

That advice may need reinterpretation today.

AI makes acquiring a craft easier but monetizing it harder.

The most vulnerable are those who haven't yet earned their first dollar from their skills. They may just learn how to work before discovering clients no longer pay for such tasks.

Written by Yuanyuan