Because it's a way to make money while you're between jobs while still using the skills you're good at. Not everyone is great at networking, nor are they necessarily in a place where they could pull good clients even if they were.
It's a shit sandwich, but in tough times, that's all you can find to eat.
You're not making money if they're refunding the client. This article and people in this thread suggest it's a terrible way to make money and to AVOID at all costs.
Or, you can use this company and I look forward to reading more of these articles.
Yes, it's worked out terribly for some people, but everyone I know who have done upwork jobs on the side have had next to zero problems.
I don't use them anymore, as I've gotten out of the tech industry and became a professional baker instead, but I get the feeling that we on HN tend to hear a few horror stories, and ignore the thousands of success stories.
I'm not saying that there shouldn't be changes made, but anecdotal evidence does not instantly justify a witchhunt and boycott.
Edit: For a slightly less sardonic answer, I prep an innumerable number of different items every day, and they all have to look near perfect. I decided that while programming was a passion of mine, I wanted to do it on my own terms. I wanted to create projects that I found interesting.
Baking though? If I want to make something at work that I find interesting, I can experiment and do that, and my boss encourages me.
So I still code, but I stopped doing it for money and started doing it to contribute to society. Baking I do for fun and money. It was a later in life career change, but I'm much happier for it.
It's a shit sandwich, but in tough times, that's all you can find to eat.