I used to freelance full-time. Having freelancers on full-time indefinitely is usually just bad management, but the economics make a lot more sense for temporary and part-time work. If you only need someone for a few months of labor out of the year, then hiring them full-time is going to be way more expensive than contracting-even with a substantially higher hourly rate. Also, at least in the US, freelancers need to charge more to just break even with full-time employment rates due to taxation and benefits.