Workers turn to freelance in tight economy

NEW YORK, May 4 (UPI) -- Increasing numbers of displaced U.S. workers are turning to freelance opportunities to make ends meet, a labor market consulting firm said.

About 26 percent of U.S. workers now work as freelancers, Kelly Services Inc. said. CNNMoney.com reported Monday that Kelly Services believed that 19 percent of U.S. workers availed themselves of freelance work in 2006.

Hiring freelance workers allows employers to avoid healthcare and retirement benefit costs. They can also dismiss freelancers quickly when specific jobs are complete.

"Not only (are) more people looking for new ways of earning money, there are also more companies looking to make their employment practices more efficient," said Rob Palmer, chief executive officer of GoFreelance.com.

For freelance workers, "the overarching disadvantage ... is that you have to cobble together your own social safety net," said Althea Erickson, a senior manager at the Freelancers Union, which provides a variety of services for freelance workers.

Payments for freelance work are often less steady than a payroll check. In addition, freelance workers often do not qualify for unemployment insurance benefits and are responsible for setting aside money for tax payments.

"There are a lot of options out there, but you have to put them in place for yourself, " said Kristen Sabol, spokeswoman for Internet freelance marketplace Guru.com.