Entrepreneurial

Small businesses hiring more online workers

October 19, 2011

When Casey McConnell started text messaging marketing company Qittle he took the traditional route of hiring onsite employees. But he soon realized it was more advantageous to hire workers online.

“We found it was easy to find these specialists or people that we could hire for a certain amount,” said McConnell, the CEO of Qittle. “We didn’t have the extra overhead and we just got the project done. It’s really easy for us to ramp up our needs or pull back using contractors. If we had an internal staff it’s pretty hard to fluctuate like that.”

Qittle’s preference to hire workers in the cloud is reflected in Elance’s recent survey that shows 83 percent of small businesses plan to hire half their workers online within the next 12 months. Only 10 percent of those surveyed plan to hire predominantly onsite workers (90 percent).

Elance, a marketplace for online workers, has posted more than 600,000 jobs ranging from programers to virtual assistants. Small businesses prefer to hire online because of flexibility, speed and economy of the process cost, according to Fabio Rosati, the CEO of Elance.

“So if you’re a small business owner, you can think of a hybrid model of hiring (online and onsite workers),” said Rosati. “You can think about what skills and what talent you need onsite. You can also decide what skill set you need to be in the cloud which is much more cost-effective and much more flexible.”

Elance’s Online Employment Report shows the number of businesses hiring online has increased 107 percent since last year. Elancers earned 51 percent more last year and earned a record $38 million in Q3 2011.

Rosati said more and more companies will decide to hire in the cloud. “I predict that at some point 99 percent of businesses will have between 5-10 percent of their hiring done online because it makes so much sense.”

But for McConnell, hiring online is the only way to go. Qittle plans to only hire workers from the cloud. “As a business we’d rather stay small and nimble and we’d rather contract out through individuals or businesses.”

 

Comments
6 comments so far | RSS Comments RSS

Though Elance is a good option, one may not reach talented individual professionals if they are not paid members. In that sense 99designs.com is better business model for SMEs. I guess, still the better business model is try with small offshore companies like us. Thanks.

Posted by Brand-Banker | Report as abusive
 

Yup, the trend to cut costs by hiring contract workers is gaining traction. No worries about vacations, sick leave, health insurance, unemployment insurance, Workman’s Comp, severance and the “contractor” has to cover 100% of their withholding.

That’s not a problem as long as the contractor can charge enough to cover those expenses along with the expenses of purchasing and maintaining their own equipment. Unfortunately, the current conditions make it difficult for a contractor to do that even if the contractor understands what his or her true overhead is.

In addition, employers need to be wary: a large number of employers (and contractors) don’t understand there are certain conditions that must be met in determining whether a person is an employee or an independent contractor – and it’s not as simple as signing a contract. The IRS and state employment agencies can come back and levy hefty fines and tax bills on employers who cross the line.

Posted by TexasBill | Report as abusive
 

Online hiring is a growing trend among a lot of small businesses and SMEs. Web based online recruitment software like recruiterbox.com is seeing an increased number startups and small businesses signing up to hire online.

Posted by Recruiterbox | Report as abusive
 

The trend of outsourcing your work to online independent constructors is seriously on the rise. I think that the benefits of flexible working and the opportunity to reduce costs are powerful incentives for everyone, imagine the SME’s that operate online.
True, more specialized sites like 99designs.com might be more efficient for design jobs but personally i prefer the choices that bigger sites, like http://www.peopleperhour.com, offer me. But still that is personal.
I just wanted to say that for those that still consider the possibility of outsourcing to online freelancers, not to. Just pick one, you can find reviews everywhere, and start outsourcing!

Posted by AnneGeorgiou | Report as abusive
 

Even though Elance is a credible site where to look and hire skills and talents online. When hiring, you must test them first in order to know each applicant’s full potential at work. This will help you reduce the risk of hiring a person who is not capable for the job that cannot be seen through resume and interviews only. Another good thing to do is don’t just stay focus on one are when hiring, which can miss you great opportunities of hiring competent contractors for the job.

Check out ( https://www.staff.com/blog/hiring-on-wor kopolis-a-mistake/ )this hiring mistakes that can also serve as guide on what to avoid when hiring.

Posted by petetaylor1 | Report as abusive
 

the trend of market is changing from both sides; employers and employees. Employers want to get their job done without any additional responsibility where online job platforms come into help. Through these platforms different overhead burdens like medical, insurance, holiday facilities are not to be in the card of employers. Even people are loving online jobs to free up themselves from time bound jobs under strict office place policy. They love to do work at home as they like. The trend can be distinctly be marked from different platform like odesk.com, freelance.com etc.
http://www.arithon.com/

Posted by Recruitment | Report as abusive
 

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