3 Reasons to Hire Full-Time — and 2 Reasons to Go With Freelancers Instead There are some situations when hiring a new full-time employee is the best move, and others when you should pick a contractor instead.

By John Boitnott

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

In today's frequently evolving business environment, business owners still must face the task of adding talent to their workforce and teams. The need for additional help can come at any time, but especially when companies are trying to grow or ramp up production.

Yet it's not always easy to know the best approach to take to adding that new talent. Should you hire someone as a full-time employee or would it be better to contract with a talented freelancer? As difficult as that analysis can be in the traditional business environments we've grown accustomed to, our new reality of decentralized remote work, coupled with the still-growing gig economy, can complicate the decision even further.

Here are three situations in which hiring an in-house employee makes sense, and two in which outsourcing to a freelancer is a better idea.

Related: Remote Work Anxiety is Real. Here's How to Help Employees Who Have It.

Hire full-time: when you have a known increase in demand for long-term work

You might know you'll have sufficient work over the long-term, and not just an immediate crucial need that demands a temporary solution. In this case your best choice is to recruit, hire and train new employees who will be valuable, full-time and long-term members of your team.

The key is to make sure your needs really do justify the costs involved in hiring. That's true for monetary costs of hiring as well as the costs of full-time employment, such as worker's compensation, insurance, bonuses and more. There's also the opportunity and time costs to consider. After all, existing personnel will have to manage this hiring process, and that means lost productive time in other areas.

Full-time: when you need to control methods, workflow or security

Occasionally, a company may secure a contract or undertake a project launch that requires the utmost in loyalty, confidentiality and enhanced security. In some situations, you may also need to control the way a person works on your project, whether that means specifying their tools, their specific workflow or their hours.

The problem here is not that freelancers can't be trusted to do the job without oversight. In fact, professional freelancers depend on their good reputation and most can comply with extra requirements. Rather, the issue is one of classification. In a lot of cases, such tight control over a worker's tools, methods, workflow and work environment mean that the worker is actually an employee, not an independent contractor. It can be a safer option to hire someone full-time, because taking on a freelancer may open the business up to potential liability for withholding, worker's compensation insurance and potentially overtime payment.

Related: What are Pulse Surveys, and How They Can Help Your Company?

Full-time: when an existing team suffers a loss and it negatively impacts productivity

You always hope you can keep top talent, especially when the worker in question meshes well with your culture and fits in nicely with their team. Yet life events sometimes lead to employees changing jobs, even when the job is a good fit.

When your existing team suffers the loss of a vital member, that leaves a gap. Often that gap will result in a loss of productivity for the team—missed deadlines, fumbles, struggling with processes and more. It may even eventually lead to a loss of clients or customers.

If this is the case, the best move is to hire someone full-time. Stability is key. However, a freelancer can be a good stopgap measure. Perhaps they can eventually be that longer-term solution you're looking for. You may even want to put the freelancer in place now so that the team can continue to meet objectives while you evaluate the need for a full-time employee to replace the one who left.

Go Freelance: when your needs are immediate, limited or uncertain

If your company is experiencing an immediate, short-term need that surpasses your existing team's capacity, or if you're simply not sure of the extent of that need, then looking for a qualified freelancer is likely the fastest way to fill the need that's open to you. Short-term and uncertain limited needs typically can't wait for traditional hiring processes, even when they've been minimized or truncated.

Finding and onboarding the right freelancer can take just a few days. Post a succinct project description on reputable job boards, then ask colleagues for their top recommendations. Conduct a phone, Skype, or Zoom interview, ask for references and then follow up with those names. Email a short-form contract in PDF and accept an e-signature in return.

Your new freelancer could start work within the week. If all goes well, and the need persists beyond the short term, you can again always discuss bringing your freelancer on full-time.

Related: What You Can Learn From Freelancers Right Now

Freelance: when your needs are highly specialized

It's a simple fact of life these days: The closure and reopening of businesses and fluctuations in employment have driven many in-house specialists to freelancing and consulting. If you need specialized, experienced help, that's where you'll find them.

Switching to freelance may have been a temporary measure for many, but it turned into a full-time business because of preferable income models and more freedom. So if your business needs that kind of highly specialized skill set, look at your available pool of freelance help first.

Choose the right approach for your business

Asking "Which is better - freelancers or full-time employees?" misses the point. Both offer strengths as well as challenges for your business. The best fit for your business depends on your company's specific needs as well as the existing and foreseeable contexts.

Related: 5 Kinds of Lazy Employees and How to Handle Them

John Boitnott

Entrepreneur Leadership Network® VIP

Journalist, Digital Media Consultant and Investor

John Boitnott is a longtime digital media consultant and journalist living in San Francisco. He's written for Venturebeat, USA Today and FastCompany.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

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