Companies often use freelancers to fill in staffing deficiencies or for special projects, which can have its merits, like flexibility and the availability of special talent, but there seems to be one caveat with doing it. A recent case study suggests that freelancers are neither a long-term nor a cost-efficient fix.

The study was performed by AgencyAgile and looked at projects at one company. The study tracked 100 projects at a quickly growing digital agency over the span of two years. The projects amounted to $7.5 million in billings for the agency, and each project was at least 100 hours long.

The study ultimately found that projects that were worked on by freelancers had a 20% lower return on investment (ROI) than those that were worked on by agency staff, and took longer to complete. The eight largest projects used freelancers. The study measured the “realized rate,” which is the amount of money that the agency makes from the project divided by the hours spent.

The average realized rate overall was $73.20 per hour, the average rate for projects worked on by freelancers was $82 per hour, and the average rate for projects worked on by agency staff was $92.

Freelancers could also costs agencies in the way of recruitment and training, as well as the losses that can come with high turnover. Almost 60% of employees steal proprietary corporate data when they are fired or quit.

The reality is though, that freelancers are sometimes necessary if a project is too big for an agency’s staff to handle. In these cases, it’s not a bad thing to hire a few freelancers, but agencies should always be wary of the number that they hire and the quality of work the freelancers produce.