Which job functions are best to outsource to international contractors?

Outsourcing certain responsibilities to contractors or freelancers has become a popular solution to many of the challenges today’s businesses face. With remote work more common than ever, companies can easily, quickly, and compliantly hire international contractors from all over the world.

Reduced costs, increased diversity, specialized technical expertise, local market insight, and new timezone coverage are just a few of the potential benefits of hiring contractors. When sourced with consideration and compliance in mind, the speed of using international freelancers and contractors can give companies a competitive edge.

But which responsibilities and job roles are best suited to outsourcing?

To answer this question, we analyzed data from one of the world’s largest contractor marketplaces to reveal the most commonly outsourced job roles and how much you can expect to pay to hire contractor talent in these roles.

We then compared the average hourly contractor rates to the average annual salary of a full-time employee, to reveal the best type of contractor or freelancer jobs to outsource for the best value return.

According to our research, marketing is the top job function that businesses are looking to outsource internationally to contractors.

Marketing is an important key to growth with many specialist areas, so it is no surprise businesses are looking outside of their full-time staff for contractor help. As a result, this job function makes up 33% of job adverts posted. There isn’t a one-size-fits-all approach to marketing globally, so hiring talent that specializes in your target market can help the success of your campaigns.

This data demonstrates that a significant group of skilled marketing professionals are experienced in working as an independent contractor and many remote professionals around the world are open to working for an international employer. Forward-thinking employers should consider international hiring for hard-to-fill marketing roles to access this large pool of highly mobile talent.

Many other skilled roles such as web design, web development, and e-commerce development are also high in demand, accounting for 10.65%, 8.73%, and 8.59% of jobs posted.  There are many benefits to hiring an individual software engineer or app/web developer rather than engaging a large agency or firm. Apart from the obvious cost and time savings, employers can also expect cleaner and faster communication, increased flexibility, and the opportunity to convert this talent from a contractor to an employee over time.

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The most affordable job functions to outsource to contractors

Depending on experience, competition, and demand, contractors and freelancers can adjust their hourly rate to reflect their expertise.

To find out which contractor or freelancer job functions are typically the most affordable to hire, we analyzed up to the first 1,000 contractor profiles online for over 60 job functions to reveal the average hourly freelance rate for each role.

The table below shows the top 10 most affordable freelancer and contractor roles ranked by their average hourly rates.

Data entry and transcription services prove to be the most affordable job functions to outsource to contractors or freelancers, costing just $11.83 an hour on average.

Customer experience and tech support follow in second place, costing businesses only $11.91 an hour. This is followed by market research and product reviewers, which come in third place at $13.20 an hour on average.

These roles are all highly competitive with plenty of contractors to choose from. This has caused contractors to lower their costs in a saturated market.

Despite attractive low hourly costs, it's important that employers ‌develop a fair global compensation strategy for their distributed workforces. This includes considering statutory minimum wages and endeavoring to pay fair and equitable local market rates.

The benefits of implementing this strategy are significant. A commitment to fair global compensation develops a stronger internal culture, increased retention rates, and increased quality of work from contractors who are more motivated to produce a better result.

To help you learn how to develop an equitable and scalable global compensation plan, watch Remote’s panel of global HR and recruitment specialists sharing practical advice and strategies in this calculating global compensation webinar.

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The least affordable job functions to outsource to international contractors

The table below shows the top 10 least affordable freelancer and contractor roles ranked by their average hourly rate advertised.

International and immigration law is the least affordable job function to outsource to a contractor or freelancer. On average, individuals specializing in this highly skilled role charge $87.80 an hour.

Remember that niche roles with dedicated expertise are often hard to fill with locally available talent, so the flexibility to source an international contractor for short-term project work can be well worth the expense.

Photography and public relations also feature in the top five least affordable contractor functions to outsource at $87.41 and $74.10 respectively. This is due to the high demand for this skill, meaning freelancers can have the power to increase their rates to match the demand.

What is the financial difference between hiring a full-time employee over a contractor or freelancer?

For many projects, independent talent may be a more sensible hire than a full-time, long-term employee. While engaging contractors over a long period of time can lead to serious misclassification issues, hiring short-term contractors can be a safe and speedy way to accelerate the completion of specific projects.

But how does the cost of a full-time employee compare to the cost of a contractor?

To investigate, we compared the average hourly rate of a freelancer to the average hourly rate of a full-time employee in the UK and US, based on salary alone, to reveal the best-value job functions to outsource to contractors or freelancers.

To calculate the hourly rate of a full-time employee, we analyzed the average national salary for each job function and divided it by the average number of hours worked in each market.

These are the best value job functions in the US to outsource to international contractors, in US dollars:

Although contractors may be more affordable in certain circumstances, companies should not use this information to avoid hiring full-time employees. In most of these fields, the contract work performed is more affordable because it tends to be less specialized than the work that would be performed by a full-time professional.

While it is good to use contractors to accelerate growth and fill in gaps, relying exclusively on contractors without the right full-time experts on your team can lead to problems. For example, freelancers are independent, so your company may not be their own priority.

These are the best value job functions in the UK to outsource to international contractors, in UK pounds:

Many of the same job functions appear on the list for the UK. Here, contract web development shows the biggest gap between full-time and contract workers. Market research is next, followed by data mining and customer experience specialties.

Remember, use caution and do not mistake a contractor for a full-time employee.

The OECD countries with the most contractors available for work

Remote and flexible working policies mean employers and hiring managers are no longer bound by geographical constraints when seeking out freelance support, so they can more easily hire contractors who are based in different countries or time zones.

This has drastically widened the talent pool and means they can bypass any local skills shortages by simply extending their search for talent to new locations.

With this in mind, we looked at ‌countries with the highest number of freelance and contract workers available among the 38 OECD nations.

The most popular contractor job types in OECD countries include design, art and creative, and writing and editing.

The United States came out on top, with almost a quarter (22.09%) of all the freelancers in OECD countries being based here. In the States, writing or editing is the most popular job function for freelancers.

After that, Turkey is home to the second-highest proportion of OECD freelancers with 13.55%. After design, web development and art/creative are the next most common job functions taken on by Turkey’s freelancers.

Colombia follows in third place with 9.54% of all OECD freelancers, where design and creative roles are most common.

In the second half of the list is Greece at 1.25%, followed by the Netherlands at 0.96%.

The OECD country with the fewest freelancers is Iceland, with 0.02%. On this basis, Iceland is the least suitable option for finding international freelancers at scale.

The benefits of hiring international contractors and freelancers

When you outsource contractors or freelancers, it can help your organization reach a number of business development goals. Finding and hiring top freelancer talent can be a much more efficient way to add new skills to your team quickly.

A freelance contractor can be found in a matter of days, especially because many of the top contractors actively advertise their services. Use the Remote job board to attract global talent and secure the right person — fast.

Avoiding delays can make all the difference when it comes to meeting deadlines or releasing products to market ahead of competitors.

Freelancers who are specialists in their fields can bring a lot of value to a project. Whether it’s years of experience using a specific tool, the know-how to solve problems that arise, or even industry connections, the business can benefit from that expertise.

Plus, when you choose foreign contractors, the timezone differences mean projects can continue around the clock. You can even offer 24/7 customer service or tech support.

The simplest way to scale contractor management

Wondering where to outsource new talent? Remote’s contractor management platform helps organizations simplify the process of onboarding, managing, and paying contractors around the world.

Every part of the contracting process can be managed on our dedicated platform, from creating localized contracts that comply with local tax and labor laws to approving and paying invoices.

Download our Guide to International Contractor Management to learn more about the best practices for hiring and paying contractors abroad.

Common FAQs about outsourced contractors

What does it mean to outsource to a contractor?

Instead of hiring a new team member, companies can outsource certain jobs to a contractor. Examples include marketing, photography, copywriting, and legal services.

Contractors are independent specialists who aren’t affiliated with the company. They can give you the skills you need without the commitment of an in-house employee. Outsource to the right people to save time and cut labor costs.

What is the most common type of outsourcing?

Out of all the available freelancing jobs, the most common industry is marketing at 32.80%, according to Remote’s research. Web designers are also in demand, making up 10.65% of freelance job postings.

Web development, e-commerce development, content writing, and customer experience positions all sit at over 8%.

When small business owners were asked what they were currently looking for, the results were similar: 27% said marketing, 22% said IT services, and 21% said they needed support with design.

What type of companies outsource writing projects to contractors?

It’s not uncommon for companies to outsource writing projects as part of their business strategy. Whether it’s a small startup looking to improve its web presence or a government department conducting research, outsourcing gives access to an experienced team.

Sometimes, instead of outsourcing to individuals, companies use the services of an agency. This partnership often comes with a wider range of specialists, including content writers, marketers, IT experts, and designers.

How do you legally hire contractors in other countries?

It doesn’t matter where you hire from because the process will be similar. The main difference is you’ll advertise globally rather than locally, and have a remote setup.

In most cases, your independent contractors will still be responsible for their own tax reporting obligations. You will need to research any relevant labor laws in their country to make sure you’re compliant.

Even if you don’t need to pay employee benefits or withhold taxes, business owners still need to follow the rules. For example, independent contractors can’t be treated the same as employees. Also, foreign contractors need to complete an IRS Form W-8BEN.

Outsourcing without the restriction of borders opens up a large, diverse talent pool. From Australia to Switzerland to the Phillippines, there are no limits. Remote can help you centralize the process of managing contractors worldwide. With flexible payment options in local currencies, you will always meet your obligations.