Shift to Online Hiring Seen to Enhance Competitiveness and Profitability for 87% of Small Businesses

MOUNTAIN VIEW, Calif. — June 23, 2010 — Elance, the online talent marketplace, announced today the results of a new survey on small business hiring practices. The survey included Elance’s small to medium-sized business customers across the U.S. and reveals that businesses are increasingly distributing project work to online contractors as part of their growth strategies. Survey results show that the majority of businesses (64%) prefer online hiring versus the traditional model of hiring onsite. These businesses not only prefer the online model, but 87% view it as a critical business strategy to enhance profitability and competitiveness.

“The majority of businesses report that while they are not adding many new employees onsite, they are opting to hire and distribute work to online teams as a core strategy to help them do more with less. Elance provides these businesses with a full featured online workplace that enhances their ability to hire and manage talent and get work done,” said Ellen Pack, vice president of marketing at Elance.

Key findings from the survey:

  • Online hiring outpaces offline hiring: 86% have hired online in the past twelve months, while 32% have hired onsite employees in the same period.
  • Online hiring is here to stay: 64% of businesses will use a hybrid model of online hiring and traditional onsite hiring as the economy improves.
  • Quality trumps cost in online hiring: the top factor businesses consider when hiring online is feedback from previous projects; work samples ranked second, with pay rate coming in third.

Preference for Online Hiring

Businesses are turning to online talent as an innovative way to grow without increasing overhead. Eighty-seven percent of businesses identified cost-effectiveness as an important reason for hiring online because there is no need for additional office space, phone lines or computers for each hire. By hiring online, businesses can tap into the creative, skilled talent they need, when they need it, to fulfill immediate business objectives. Eighty-two percent of survey respondents cited the flexibility to adjust their staffing needs up or down as an important reason for hiring online, while 66% liked the 24-hour/7 day a week access to talent.

The survey results challenge assumptions about the importance of a candidate’s pay rate. When asked about the top criteria for hiring professionals online, businesses ranked pay rate as the third most important criteria (73%), citing the ability to access feedback and ratings from prior employers as the most important factor (89%) and viewing a portfolio of work as the second most important factor (84%). Only 19% of those surveyed ranked location as an important factor when hiring online.

Building Distributed Organizations

Businesses are increasingly building organizations made of both onsite and online distributed workers. Sixty-four percent of businesses plan to hire both onsite and online as the economy improves. The majority (86%) of businesses had made at least one online hire. Nearly half (49%) had made between two and five online hires and 15% had made more than six online hires in the same time period. Only 2% of survey respondents plan to hire exclusively onsite as the economy improves.

The New Office

Elance powers the trend of online work by connecting businesses with top talent and providing businesses with the tools needed to successfully hire and manage these resources. The company has strengthened its platform for online work with the introduction of two new service enhancements, Work View™ and Profiles.

Elance Work View™, an opt-in service for employers and providers, offers visibility into hourly work and guarantees payment to providers performing the work. Work View allows providers to document the time they spend working online and automatically submit timesheets verifiable by their clients.

Elance Profiles have been enhanced to help employers better evaluate skilled providers and determine the best fit for their business with information on qualifications and past performance, skill tests, complete online job history, previous feedback and employer ratings and references.

About the Study

Elance conducted this survey from June 3 to June 14, 2010. More than 500 Elance customers participated in the online survey. For more information on the survey and to view results, visit

About Elance

Elance, the world’s leading online talent marketplace, helps companies hire and manage professionals online to get work done and grow their businesses.

Elance instantly matches employers with a ready and qualified workforce of more than 155,000 rated and tested professionals with technical, marketing and business skills, and provides the tools to manage online and pay for results. With more than $275 million in earnings to date, contractors and service providers around the world use Elance to meet employers and get paid for delivering great results.

The company is privately held and headquartered in Mountain View, California. For more information, visit Elance at

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Elance, the Elance logo and Work View are trademarks or registered trademarks of Elance, Inc. in the United States and other countries.

Media Contact:

Carolyn Adams
Phone: (415) 963-4174 ext. 4