The pros and cons of hiring freelancers in emerging markets
If more UK businesses embrace hiring freelancers in emerging markets to cut down on overheads and employee costs, where does that leave UK freelancers and the British economy? Is there a happy medium?
One in 7 businesses is likely to be forced to freeze hiring, lay off staff, and cut back their expenses, as massive inflation sweeps the globe. Trying to stay afloat, 78% prefer to hire freelancers in an uncertain economy, while 55% hire remotely, tapping into global talent, often with more favourable terms, such as lower salary expectations and taxes.
That’s according to research carried out by Kyiv-based freelance software developer and startup recruitment platform Lemon.io, which can confirm that Ukrainian developers are still in high demand despite the war in Ukraine.
Compared to Western Europe, the hourly rate in Ukraine is lower than in other parts of Europe – 20 euros per hour.
“Meanwhile, global tech firms are still lining up to hire Ukraine’s world-renowned coders,” says Yulia Mamonov, Lemon.io’s head of content. “WhatsApp, Grammarly, Gitlab, and Solana were all founded or co-founded by Ukrainians, while Google, Samsung, and Amazon all have research and development centres in the country,” she says.
The company is not shy about letting the public know that it is raising funds from some clients to back the Ukrainian war effort. Freelancers and tech founders on the ground in Ukraine have been working in unthinkable conditions. An article was written about these efforts back in April. But those freelancers that have managed to safely move out of the country see the true value of remote working on so many levels.
Lemon is naturally praising the financial benefits for remote workers and the businesses that manage to operate a remote working environment. Most UK and US freelancers are also praising the financial and personal benefits of remote working.
For example, Americans save up to $12,000 per year by working remotely full-time. However, the team at Lemon.io, also wanted to measure the financial benefit for companies hiring remotely.
They crunched numbers and found that companies working remotely save, too; some $10,600 (approx. £8,900) per worker annually – that’s $10,601,000 a year for a team of 1000.
The main categories of savings include:
- Office rental costs: savings make up $5,580 annually per year employee, with a minimum of 120 square feet per employee.
- Utilities: including repairs and maintenance, this category saves companies $2,121 a year for each staff member.
- Coffee, tea and snacks: as companies spend an average of $5 for employees’ daily snacks, their annual cost makes up $1,300 per person.
- One-off expenses: at the very least, companies provide employees with a desk (≈$35–50), a chair (≈$40–60), and a laptop (≈$1,000–1,500), which adds up to $1,100–1,600.
Arguably, if more British companies hire freelancers from lower-wage economies that’s British jobs lost. The purchasing power of Britain’s citizens is already in jeopardy as most freelancers have not seen their rates increase to match inflation. If companies decrease hiring British-based freelancers there is an argument that it could be detrimental to the British economy.
But if you are a freelancer looking to grow your business or looking for a helping hand, a platform and highly skilled freelance community such as Lemon could be a win-win.
To check out Lemon.io’s full study, go here.