The city where I live (which I imagine is indicative of other cities as well) the local population of freelancers and small studios forms a pyramid.
The top half of the pyramid is made up of really phenomenal freelancers and small teams. Individually, they have pretty cool industry experience and have learned a lot from their careers, to the point where they have the negotiating power to operate as a well-payed contractor. As for the small studios, if they really wanted to they could use their in-house skills to create really amazing products and make money that way, but the personalities of the people who work there are more aligned with work where they can work on a multitude of exciting things at any different time.
The bottom half of the pyramid has some people who are in a transitional state, who will eventually move to the top half, but it's mostly made of a lot of mediocre generalists. They saw that a lot of businesses just wanted a damn website, they figured out they could make that damn website, they figured out they could potentially make a lot of money this way, so they learned the basics of the LAMP stack, learned how to use Wordpress, and threw themselves into a crowded ring.
To be fair, I've met a few of the bottom-halfers, and they seem like alright guys, but talking shop with them is pretty awful. They're not really life-long learners, or they have this unbalanced focus towards business and marketing with the idea that they can communicate the value of what they can do better, but not really looking into actually delivering more value through better skills.
To sum it up, the top-halfers move with the changing market, the bottom-halfers just sort of sit there and wonder why more small businesses don't want custom Wordpress sites.
I realize this can seem callous and harsh, but at the same time I've also seen the bottom half of the pyramid screw over small businesses on the regular. The don't explicitly brag about it, but they kinda do on an implicit level, and it's sad for the small business and it's sad that the person bragging has this weird sense of value exchange.
Besides that, it's not like life ends of these freelancers either. So long as they're humble about the fact that they need to learn new skills, they can probably use their experience to get a pretty great job. It probably won't pay as much, but it's still going to pay pretty well. If they can't accept this, then I don't know if I can sympathize.