Freelance recruitment is broken

June 10, 2022
Freelance recruitment is broken

Many industries have disrupted themselves the last 20 years. We shop online, watch movies on demand and book accommodations ourselves via Airbnb…. but finding and hiring freelancers is still very very old school.

We post on job boards and pray for good results. We ask our network on LinkedIn and keep a shortlist in Excel. Or we outsource the whole process and decide to work with an external recruitment partner… Which turns out to be expensive, time consuming and often doesn’t deliver.

It’s my personal mission to make freelance recruitment hassle free and as easy as booking that Airbnb in Tuscany.

For this we need to rethink our current models, processes and systems. All parties involved need to change their role in the freelance hiring value chain.

We need to focus only on the 3 core ingredients: availability, quality and financial compensation.

It’s a mess right now

I’ve been working in digital product development my whole career. Let me take you on a short journey on the inefficiency I see in the current state of freelance recruitment in the digital industry and why it must change.

Yes! The project can start! Let’s assemble the team! This happens weekly at digital agencies, software companies, corporates, startups and scale-ups. All these product teams are creating concepts, digital products and services. And they all use the same disciplines for it. Strategists, designers, developers, marketeers, product owners, data scientists. Whenever a pitch is won, some next epics are defined, a new tool needs to be implemented or a project can start finally, the operations people are rapidly trying to assemble their teams.

But what do they do when they are a few positions short? The project usually can’t be postponed, clients and other teams are waiting, they can’t wait for HR to find a new permanent colleague… These types of companies and projects will want to hire a freelancer.

And so the search begins.

Is Jane available? Or Jasmin, John, Erika!? We also worked with this one freelancer for shorter projects last year, what’s his name? Didn’t Jim keep a list with freelancers we previously hired? Where ís Jim by the way? Freddie, do you know a good UX designer!?

There are now roughly 3 ways this search is continued:

  1. Everyone in the team starts reaching out. Good effort!
  2. HR is in charge and starts pushing a company portal. Hello waste…
  3. Procurement is in charge and they pass it on to a recruitment agency. Oh noooo!

Everyone in the team starts reaching out. This is by far the best method, because most freelancers get their next project through their network. It’s only very inefficient because sourcing is not their main responsibility plus no-one is keeping a curated list of their favourite freelancers. Maybe the project-lead, or a group of pm’s, but that’s usually a static google doc with some quickly added notes.

When HR is in charge the responsibility is actually in the right place, but HR is very busy. They spend a lot of their time and money on recruitment and employer branding which is primarily aimed at reaching potential candidates for permanent positions. Whenever they are also responsible for hiring freelancers, they often resort to putting up a company portal or pass the problem on to a recruitment agency. The company portal is a place where they publish their freelancer jobs in the same manner they write vacancies for perm positions. Long, boring job descriptions that hardly match the more temporary way of involving the skills & expertise of these freelancers. Worse, the freelancer has to register for this portal, and this way ends up with an average of 17 company portals where there might pop up work for him/her in the future. Highly inefficient.

HR often doesn’t know the people and skills they should be looking for, so it’s tempting to ask specialised recruitment agency to perform the search. These recruitment agencies present themselves as representatives of groups of freelancers. But more often that’s just marketing. They themselves hire other niche recruitment agencies to find the freelancers. The result: a stacking effect of parties involved in the hiring of one person. This brings higher fees because everyone wants their cut. When asked these parties are not transparant about their fees.

Lastly - and this happens most at larger companies - procurement can be in charge. When large amounts of freelancers are contracted, it’s more efficient to work with brokers or other administrative parties that aggregate all invoices of freelancers and bundle that in one larger purchasing invoice.

When Procurement and Brokers are in charge...

Most of the times these brokers / middle-men also convince procurement that they can deliver the freelancers. And this is a big issue because procurement then often negotiates special delivery terms such as ‘after posting the vacancy we expect 10 resumes on our desk within 7 days or else you’ll receive a penalty’.

Brokers are not very well connected within the freelance space so delivering on this demand brings stress. They resort to frantically calling around, hunting for quick results, posting on LinkedIn and praying for reactions.

They’ll ask every freelancer they get in touch with about availability (because you know), and when the answer is no they’ll ask “hey, would you by any chance know some-one else who might be a fit for this job?”… Many freelancers are friendly, and suggest someone else.

The primary business model of said broker is to charge an extra fee of 5 to 15% on top of the hourly wage of the freelancer towards the client. But if 9 out of 10 times the broker ends up offering a freelancer to the client with whom they didn’t have a relationship before…then that 5 to 15% is just waaaaay too much for the delivered effort!

This intermediary way of working was popularised when Frits Goldschmeding (founder of Randstad) brought his very first temporary worker to work on the back of a bicycle in 1960. He personally made sure that she knew exactly where her new workplace was and that she would arrive here on time. He took the time and effort to get to know both the company and the candidate personally.

This way he was sure that a good match between candidate and organisation would eventually be created. This was the foundation of brokerage in this industry. But that’s not what’s happening anymore within the freelance industry. The market is crowded with cowboys and bounty hunters who are in it for the quick fix. Almost for the adrenaline rush.

What’s lacking is the personal touch. And it needs to return.

More, more, more freelancers

Relevant to freelance recruitment there are a few trends worth mentioning:

  • The labor market is shrinking. We are all very aware of this. Instead of seeing it as a risk, smart companies are seeing the opportunity in working with freelancers and keep moving forward.
  • Different kinds of work will continue to be a key trend in the job market. We’re seeing more positions for contract work, project work, and one-off commissions, and more people are finding that self-employment is a better option for them than conventional employment (Techradar).
  • The great resignation. Wikipedia says it best: ‘The COVID-19 pandemic has allowed workers to rethink their careers, work conditions, and long-term goals. As many workplaces attempted to bring their employees in-person, workers desired the freedom of remote work due to the COVID-19 pandemic as well as schedule flexibility, which was the primary reason to look for a new job. Additionally, many workers, particularly in younger cohorts, are seeking to gain a better work–life balance.’ Many of these workers have started freelancing in 2021/22.
  • New talent more often chooses to start with freelancing and remote work directly after graduating.
  • Freelancers in digital are scarce, same as candidates for perm positions. They can choose which client to work for, and are able to choose out of multiple projects at once. So the clients looking for freelancers should be aware of that.
  • Freelancers in digital like to work directly with clients. They don’t like working through sites like Upwork or Fiverr anymore, because it’s a race to the bottom on these platforms. Most projects there are gigs spanning hours or days, while freelancers in digital work on projects with an average of 2 months.
  • The project economy is here. People are organising their work in long term projects and mix their career with freelance and permanent periods.

For companies to stay agile in this changing labor market, it’s necessary to build and work with an effective freelance pool. And if they want to be attractive as a client, they’ll need to address those freelancers in the same way as they address potential candidates for perm positions.

Takeaways for companies

Companies need to put smart effort in their freelance recruitment approach. By becoming a freelance friendly company they will be more able to hire the best available freelancers for their projects.

  • Invest in freelance relationships throughout the whole hiring journey. From recruitment, selection and onboarding, to collaboration and off-boarding.
  • Make it easy for new freelancers to show their interest in working for you. Connect with those freelancers who are intrinsically motivated to work for your brand.
  • Build and maintain a talent pool based on the skills you need with new and known talent.
  • Capture experience data of the freelancers you have worked with. What team size do they fit in best, what leadership qualities did they possess etc. This knowledge makes rehiring of freelancers very easy, also at other departments within your company.
  • Most freelance project work in digital lasts from a few weeks to a few months. Maternity leave replacements can take up to 6 months. The result is that freelancers in many companies can be treated like just another colleague coming to the office or entering the chat. Make them feel part of the team. Invite them for the team training and company parties, give them a birthday present and perform regular performance evaluations and give each other feedback

These takeaways will strengthen the relationship between the company and freelancer. Freelancers who are positive about your company will refer to you as a great place to work to other freelancers and future employees.

Freelancers aren’t permanent employees, but you are starting a permanent relationship.

Takeaways for freelancers

What I 💚 most about freelancers is that they behave like colleagues amongst each other. Even though many of them are in competition. This explains why 90% of work travels from word of mouth, from freelancer to freelancer.

Let’s start leveraging this!

  • Actively build and maintain a network of companies and other freelancers.
  • Become less dependant on recruiters.
  • Keep control over the type of projects and companies you would like to work for.
  • Think about which company relationships you want to establish and put effort in that. Show your interest in those companies pro actively.
  • When you are fully booked, broadcast your future availability. This way companies are not left in the dark and you can manage upcoming opportunities.
  • Pay it forward. Help other freelancers with finding work. It’s all about the principle of reciprocity.

Let’s rethink freelance recruitment

Freelancers are becoming more picky on what types of companies they want to work for and what types of projects they wake up for.

  • They demand autonomy and connection.
  • They are hired for their competence and they want their clients and projects to align with their personal values.
  • Similar to the power of the employee, freelancers will be in more demand and will be more difficult to find.

It’s my firm belief that niche communities and freelance first platforms will dominate the future of freelance recruitment. They are clearing the mist on ‘who has the skills’, ‘who’s available’ and ‘who’s good’. Many brokers won’t be able to add value in that quest anymore.

Niche and new school platforms in Europe are already positioning themselves this way: Codecontrol, (yes I’m one of the founders) and Indielist are all putting the freelance relationship first. They recognise that even experienced freelancers can struggle to find work while at the same time less experienced freelancers struggle to find their first client. And they can both be helped.

These platforms are created by freelancers for freelancers and are purpose driven. They focus on connecting the right digital creative and tech freelancers with innovatie companies and teams to get project work done in a smarter way. They are together shaping the future of freelance work.

Now back to work. ;-)

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