Amid rising costs and inflation, 41% of business owners cited lowered productivity among their workforce, despite 36% reporting an increase in working hours, according to a survey by Fiverr.

The report also found that 78% of remote-only companies are less likely to implement a hiring freeze, compared to 87% of companies operating in person.

Meanwhile, 88% of hybrid-working companies are most likely to implement a hiring freeze.

“Businesses have proven their resilience over the past few years, but the economic downturn — including the cost-of-living crisis, inflation and the volatile stock market — has delivered yet another obstacle to add to the list,” Fiverr Business General Manager Shany Malbin said.

“Changes to headcount and working arrangements are unfortunately necessary during cost-cutting periods, and yet businesses need to ensure staff still feel supported and morale remains intact. It’s encouraging to see that savvy business leaders are turning to freelancers in order to fill any talent gaps in their workforce to avoid things such as burnout and reduced productivity.”

Additionally, the survey found that 31% of business owners have had more salary and benefits requests from staff, while 87% are re-examining their fixed (lease, insurance, etc.) and variable costs (staffing, benefits, etc.)

Other findings:

• 74% of remote-only companies are less likely to lay off staff, while in-person and hybrid working companies are more likely to reduce their workforce, at 80% each. 
• Among businesses with 500-plus employees, 45% reported reduced productivity, while 23% of all business owners observed reduced morale.
• 43% of business owners surveyed plan to hire freelancers to fill talent gaps in their workforce. Meanwhile, 81% of respondents reported they are already using freelancers to support their full-time staff. 
• In addition, 40% of business owners feel independent talent provides a larger talent pool for recruitment, and 38% believe freelancers are more efficient.

The survey was conducted by Fiverr Business in partnership with Censuswide and includes responses from more than 1,000 business owners.