With fears of a double-dip recession mounting, companies are preferring to hire freelancers in a bid to save money, a survey has shown.

Online freelance website PeoplePerHour.com found a 94 per cent increase in businesses looking to outsource their work to temporary staff to cut costs over the past year.

Amanda Ashworth, director at Excelsior Recruitment Partnership, which uses the website said: “Using freelancers enables us to get on with what we need to do and outsource other things like marketing, SEO ... to freelancers without having to commit ourselves and also we are able to set the budget.”

However some businesses are reacting to recessionary pressures through turning to permanent employees to cover the skills in-house, according to Katie Kirk, who runs the website Freelancers In The UK:

“In the last 18 months, we've seen more people return to freelancing but there does still seem to be a rather cautious approach [from businesses] ... I do agree that there's a more flexible approach to work these days.”

Managing Director of Professional Contractors Group,PCG, John Brazier said it was not yet clear whether the freelance marketplace was growing.

"For example our latest freelance market results show a noticeable decline in freelancers working in the public sector. Thankfully this slack has been largely covered by the Private Sector and overall we have seen freelancers in contract for at least 11 out of the last 12 months suggesting some stability.

“For anyone considering going freelance there are many challenges and going it alone and particularly in times of hardship it is a very brave step.

"If you go freelance you become a business owner not an employee so will not receive employment benefits such as sick pay, holiday pay, pensions and on top of this face new operating costs such as professional indemnity insurance and accountancy."