Hiring Freelancers: When You Need to and What You Should Know

As of February 2024, Upwork estimates that there are 76.4 million freelancers in the United States, which is an increase of 3.1 million from 2023. This number is expected to continue to grow, reaching 79.6 million in 2025, 83 million in 2026, 86.5 million in 2027, and 90.1 million in 2028. By 2028, freelancers are expected to make up more than half of the US workforce.

According to Linkedin, 70% of small businesses had hired a freelancer at some point. 81% of those who had hired a freelancer plan to do it again. While 81 is a decent number, it’s disappointing that it’s not closer to the high 90s. This speaks to a few things:

  • Their business simply isn’t growing and thus they don’t need the help
  • It’s growing so fast they need/want to hire full-time
  • They’ve worked with contractors or freelancers and had a bad experience

 

That last bullet is disheartening for the millions of  people who work as an independent contractor. One lackluster experience gives all freelancers a bad reputation when they could be a very good solution for your business.

Ideal Times to Hire a Freelancer

First, there are many different kinds of freelancers. There are content producers, coders, bookkeepers, consultants, marketers, SEO experts, and more. You can use a freelancer as a permanent or temporary solution. You might consider hiring a freelancer when you:

  • want to try something new. Maybe you have a new demographic you want to hit, a new product area you want to explore, or a new tone you want to use in your communications. You want to make a switch and bringing in a new person on a temporary basis may help you figure that out without making any long-term promises or commitments.
  • need a new set of skills. In keeping with the idea above, maybe you want to do something in your business that you don’t have the skills for. If you don’t completely understand what you need, hiring a full-time person can be difficult. Instead, bring on a freelancer that can help you figure out the process and then you can decide what will serve you best in the future.
  • have seasonal overflow. Maybe you have busy and slow seasons. You can bring on an independent contractor during the busy season instead of hiring someone full-time.
  • are being taken away from your work (you know, the stuff no one else can do as well as you can) in order to do things that others can do better. For instance, if you are a brilliant salesperson who never met a client you didn’t close, it makes sense to keep you in that role bringing in money for the business. Anything that distracts you from that should be handed to someone else who excels in those other areas.
  • need a very specific skill. There are times when you need a very niche skill set. Some of those times are temporary, like needing someone to set up a process or procedure for you or something like creating an app. If that project won’t continue into the future, it may make sense to hire it out.
  • want to save money. Freelancers have very little overhead. Even highly-paid freelancers often cost less than employees when you factor in the savings on benefits.

3 Things to Keep in Mind When Working with a Freelancer

Working with a freelancer is different than working with someone you employ. Outside of their personal life, your employee can be directed to whatever project you see fit. If they’re working on Project A and you’re in a time crunch and need Project B completed instead, you can reprioritize their workload. If you try reprioritizing a freelancer’s workload, you may miss the spot in their schedule and they might not be able to accommodate your delivery date. Here are several other things you need to know about working with freelancers:

Is the project long-term or short-term?

Be upfront as to whether this project is long- or short-term. Don’t assume because it’s only a week’s worth of work that they’ll turn you down. That might be all they have in their schedule. On the other hand, if you’re testing them to see whether you enjoy working with them or not and whether they can deliver, tell them something like, “The initial project is two weeks long with a possible opportunity to work together in the future.” That way if they have a full calendar, they will understand you’re looking for the possibility of long-term and can tell you at that moment instead of later in the project.

Do you pay upfront or upon delivery?

Freelancers charge in different ways. Some will expect to be on retainer for ongoing projects. They need to keep their calendar free to accommodate your schedule and they charge to do so. Some will ask that you pay once the project is complete. For long projects, some may require an amount upfront and then an amount upon delivery. Make sure you understand the payment schedule.

Also, if they bill upon completion, pay as quickly as possible. Most freelancers who bill this way issue the invoice “due upon receipt.” If it takes you an additional month to pay, you’re actually two months in arrears from when they started doing the work for you. If you want to be a preferred client, and you want them to “squeeze you in” on occasion, you want to do your best to achieve that preferred designation in their mind. Paying on time will help with that.

Do you have emergency work?

This is one of the hardest things to get used to for most employers. A good freelancer is in demand. They schedule work out at least two weeks in advance. Any change to the project places schedules at risk and not just yours. I have had to reevaluate working with clients a couple of times when their business model is one of reaction.

There are certain companies that operate in reactive mode, it’s just the nature of their business. Let’s say you hire a freelancer to write up your sales contracts. You may not know exactly when that order is coming in so you can’t give your freelancer a schedule. Unless your freelancer does this work part-time and has very few clients, you will likely need to pay a retainer fee to keep your freelancer “open” for your work at least part of the week. If this is the nature of your business, be upfront about it in initial discussions. Some freelancers can accommodate quick, unexpected turns. Many cannot without a retainer.

Popular Misconceptions About Working with Freelancers

Here are some popular misconceptions and erroneous stereotypes when it comes to working with independent contractors. Knowing the truth behind them can improve your business relationship:

  • They can drop everything to take care of your emergency. Sometimes they can, but not always, unless this is something in your contract.
  • They are irresponsible. If they are a full-time freelancer, they want to see you succeed. One of their most effective marketing strategies is referrals. Good freelancers deliver on time.
  • I need someone in my office not someone in PJs at home. Some freelancers work on location. If that’s what you require, ask them.
  • It will take a long time to explain what I need and to bring them up to speed on our culture. Freelancers “blend” into businesses every day. Don’t let this concern hold you back.
  • Sites like Upwork are the only place to find freelancers. Like any employment agency, these sites take a chunk of income and keep prices low. There are plenty of quality freelancers who refuse to work off of them because of this. Ask people in the community for referrals.
  • They’re all a bunch of twenty-somethings with no work experience. Freelancers run the gamut from an experience standpoint. You can find beginners and people who left very successful careers for more independence. You can match your experience needs with that of the freelancer.

If you’re considering hiring a freelancer, remember there are some differences between them and a traditional employee. Think of them the way you would a vendor business. They have their own clients, aside from you. Perform your due diligence in scouting them and talk to other business owners to see who they use. Don’t assume your business friends aren’t using freelancers. There may be quite a bit done behind the scenes that you are unaware of.

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