UK SMEs are reluctant to hire full time staff, instead favouring freelancers, according to new research published by Elance.

Of the 500 SME decision makers surveyed, 92 per cent said that they were more cautious about employing full time staff due to their experience of the recession.

39 per cent of respondents said they would not be hiring full time staff over the next 12 months in order to keep costs down.

The research found that SMEs commonly employed freelancers and offered part-time work as a way to reduce costs, with 25 per cent of respondents saying they planned to use more freelancers over the next 12 months.

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Kjetil Olsen, Vice-President, Europe, Elance, said: “Keeping fixed costs down is critical for SMEs yet with signs of an economic recovery, SMEs can not afford to lose out on spontaneous market opportunities. SMEs are turning to skilled freelancers to enable them to scale up and down when resources are required, yet not add to their fixed cost base.”

“The research shows that UK SMEs are seeing freelancers as an important part of their staff mix going forward. We are seeing more businesses adopting a hybrid workforce model where businesses turn to a global pool of online freelancers to work alongside full time employees. This approach allows businesses to buy in required skills whilst maximising business growth.”