Why Freelancer Marketplaces Are Still Going Strong

Chinwag recently questioned the quality and value of freelance marketplaces. I wanted to provide an alternative perspective, having used such marketplaces to both find work and hire staff.

The author, Isabella Ramos, says that the failure of freelance marketplace to provide a quality alternative is the reason job search sites are yet to see a fall in traffic. In my opinion, it is still too early to assume the job market today considers freelance workers as a worthy replacement for in-house staff.

There may be stories of freelancers making millions out from the marketplace, but the vast majority of marketplace applicants belong to one of the following categories:

• Professionals who want to make extra money through freelancing  
• Students seeking experience
• Small companies from developing countries bidding on lucrative tech projects posted by businesses in the west

None of these can take up a full time role at a business in the west. This means, in most cases, freelancers are only hired when it doesn’t make sense to hire a full-time or even a contract worker in the west. It’s no surprise that job boards like Monster are still not seeing a drop in postings.

Ramos' second point is that the freelance marketplace is seen as a last resort. To understand this, I talked to Jay Barnett, founder of Priority Pickup, an online passenger services company based in Australia. Barnett has hired several freelancers from across the world - Macedonia to India. His core business is offline - dealing with customers of his airport transit services company.

When a local business as his wanted to go online, it did not make sense for him to hire a full time staff of developers and marketers. It was plainly a business decision to outsource these tasks. Barnett chose to hire from Freelancer.com because he found worthy candidates.

Besides Barnett, several small business owners from the United States, Canada, Australia and UK are today finding freelancers through these marketplaces because their core business is outside the internet and they do not want to go through the process of hiring full-time staff.

The article also focused on 'spam' posting of bids, and measly pay. I think the first argument is redundant because this is the way all marketplaces, even Monster, work. Employers often deal with several hundred irrelevant resumes.

However, the low pay offered on freelancer sites is something to take note of. But is that a worry? That depends on how you look at it.

Freelancer sites have dynamically changed the way businesses employ people, collapsing geographical boundaries. It is difficult to hire people based on the minimum wage prevalent in the employer’s country especially when the employee is from a country like India or the Philippines where the minimum wage is much lower.

Finally, any seasoned employer in the freelance marketplace knows the adage ‘you only get what you pay for’ is absolutely true. Bids should not be based merely on the quote, but on the proficiency of the freelancer.

The cliche holds true: pay peanuts and you get monkeys.

Photo (cc) Chiot's Run. Some rights reserved.