The Freelance Economy - Breaking the Full-Time Mold
By Derek Schou, Associate Editor
From software developers to copywriters, freelance work has become commonplace in a variety of industries over the years. As companies look to fill temporary positions or scale their workforce, many are turning to freelance professionals and it is proving to be a mutually beneficial relationship.
In fact, 68 percent of users on Freelancer.com have joined the marketplace to make extra money, whereas 25 percent are using the marketplace to start a new full-time business and 19 percent to start a part-time business.
To connect companies with independent contractors, a variety of platforms exist. Top marketplaces include the aforementioned Freelancer.com, as well as Guru.com, Elance.com, Upwork.com (formerly oDesk) and others. Discover where to hire freelancers for a variety of projects at wsm.co/topflance.
Before jumping straight into the top freelance marketplaces, it's important to note some of the advantages and disadvantages for companies hiring independent contractors in the new services economy.
Did You Know?
According to Q1 2015 Freelancer.com data, the number of freelance jobs increased for:
+eBooks (up 43 percent)
+creative writing (up 41 percent)
+content writing (up 26 percent)
+ghostwriting (up 23 percent)
Advantages of Hiring Freelancers
One of the greatest benefits of using freelance workers is the ability to select individuals with very specific skill sets for the task at hand. If a software design company is preparing to release a product, but is struggling on a specific aspect (e.g. the user interface), for example, it can hire a freelance programmer with expertise in this area. Not only are freelancers brought in for their expertise on particular projects, but businesses also use these independent contractors to reduce costs over the long-term.
"I have been a freelancer for almost 20 years, but in the last couple of years, I have had to subcontract out some of my work to other freelancers to meet the demands of my clients," said Lysa Miller, CEO of ladybugz.com, a Web design and Web marketing firm. "It has worked really well for me because my business is more project based, so I don't have to pay people when I don't have projects. "Hiring freelancers has allowed me to grow my small business and meet the needs of more and larger clients. If I had to hire full-time staff to do the work, I would not be able to grow or meet their salary needs."
Freelancers are so in demand that Intuit even went as far as predicting that more than 40 percent of the U.S. workforce would be freelancers by 2020. It should be noted, however, that the prediction was made in 2010, in the aftermath of the U.S. economic downturn.
What to Watch For
While greater expertise and lower overhead are certainly solid business reasons to hire freelancers, there are several drawbacks to the practice; most notably the issue with intellectual property.
For those who need a quick refresher, Intellectual Property (IP) refers to "creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and images used in commerce," (World Intellectual Property Organization).
In other words, who owns the work that is created? According to the Freelancers Union, unlike regular full-time employees, freelancers have the legal rights to whatever "self- (not group) created products" they designed for companies. In fact, when freelancers are working for a client, said client is actually paying them for the right to use their Intellectual Property.
While companies can negotiate their use of freelancers' IP for years after its creation, contract talks can become lengthy and costly.
While the intellectual property concern is a major one, there are other issues that must be addressed, including onboarding, access to essential business platforms (e.g. content management or e-commerce systems), communication protocols and more.
Check out a 10-step checklist for working effectively with freelancers in the new services economy at wsm.co/flance10.