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Whether you run a new startup company or run an established small business, there will be times when the skills you need aren’t available in-house or when your staff simply isn’t sufficient to meet expanding needs. When these needs arise, hiring freelance workers or independent contractors can be a viable option. But how can you tell if they are the right choice?
There are pros and cons to choosing freelancers over new employees. Let’s take a look at them.
Pros of Hiring a Freelancer
Cost Savings
The Center for American Progress places the cost of hiring and training an employee to be equivalent to approximately 20% of the position’s base salary. As the required skill set becomes more specialized and responsibilities increase, these costs can multiply.
Hiring and training represents money invested before your business sees any return in the form of production from a new employee. It doesn’t include continuing expenses such as payroll taxes, Social Security, workers compensation, vacation and sick leave or other benefit expenses. Freelancers can also be easy to find, through your own network or a service provider.
Specialization
The majority of freelancers are specialists who work in one particular field. Copywriters write articles and blogs, graphic artists create visuals, and developers create software applications. With each new project, they gain more experience. And each new client exposes them to different requirements. This means they gain experience and knowledge quickly and bring it with them to your company when you hire them. Freelancers are usually experienced in documenting work requirements, ramping up quickly and delivering the goods on or before schedule.
Network
Many freelancers have a network of fellow professionals they know and can turn to with parts of a project outside their own specialty. Writers know graphic artist from past advertising projects, programmers know app developers from past work. When one freelance finds another professional who can help get the job done, this frees you from the need to find and vet multiple people.
Cons of Hiring a Freelancer
Timing
For many freelancers, the operative part of their title is “free.” They work the hours and days they want and at the time of day they choose in whatever time zone they happen to be located in. This can make reaching them at your convenience problematic.
As a practical example, last-minute meetings can be difficult to arrange and scheduling can become a hassle to track.
Freedom
Related to the above point, freelancers are not likely to be at any one client’s beck and call. Freelancers might not react well to changes in project requirements. Unlike an employee who has little choice but to take things in stride, they can walk away or raise their prices if your demands change.
Legal Issues
Those who hire freelancers must realize that independent contractors are not employees. The IRS has strict rules governing contractors’ status. A business owner must be cognizant of these requirements, and face stiff tax penalties for not complying.
As an owner of a small to mid-sized business, using freelancers can be one way to minimize your expenses while gaining access to very experienced people.
For short-term needs or one-off projects, freelancers can work well. If your needs are of a more long-term nature or you are looking for a team player, then investing in hiring an employee might be a better choice.
There are pros and cons to choosing freelancers over new employees. Let’s take a look at them.
Pros of Hiring a Freelancer
Cost Savings
The Center for American Progress places the cost of hiring and training an employee to be equivalent to approximately 20% of the position’s base salary. As the required skill set becomes more specialized and responsibilities increase, these costs can multiply.
Hiring and training represents money invested before your business sees any return in the form of production from a new employee. It doesn’t include continuing expenses such as payroll taxes, Social Security, workers compensation, vacation and sick leave or other benefit expenses. Freelancers can also be easy to find, through your own network or a service provider.
Specialization
The majority of freelancers are specialists who work in one particular field. Copywriters write articles and blogs, graphic artists create visuals, and developers create software applications. With each new project, they gain more experience. And each new client exposes them to different requirements. This means they gain experience and knowledge quickly and bring it with them to your company when you hire them. Freelancers are usually experienced in documenting work requirements, ramping up quickly and delivering the goods on or before schedule.
Network
Many freelancers have a network of fellow professionals they know and can turn to with parts of a project outside their own specialty. Writers know graphic artist from past advertising projects, programmers know app developers from past work. When one freelance finds another professional who can help get the job done, this frees you from the need to find and vet multiple people.
Cons of Hiring a Freelancer
Timing
For many freelancers, the operative part of their title is “free.” They work the hours and days they want and at the time of day they choose in whatever time zone they happen to be located in. This can make reaching them at your convenience problematic.
As a practical example, last-minute meetings can be difficult to arrange and scheduling can become a hassle to track.
Freedom
Related to the above point, freelancers are not likely to be at any one client’s beck and call. Freelancers might not react well to changes in project requirements. Unlike an employee who has little choice but to take things in stride, they can walk away or raise their prices if your demands change.
Legal Issues
Those who hire freelancers must realize that independent contractors are not employees. The IRS has strict rules governing contractors’ status. A business owner must be cognizant of these requirements, and face stiff tax penalties for not complying.
As an owner of a small to mid-sized business, using freelancers can be one way to minimize your expenses while gaining access to very experienced people.
For short-term needs or one-off projects, freelancers can work well. If your needs are of a more long-term nature or you are looking for a team player, then investing in hiring an employee might be a better choice.
