Casey McConnell began text messaging a marketing company and he took the traditional way of hiring employees that would work in the office. However, he soon realized it was better to hire workers online. From that point forward, he began his journey that would transition him from a traditional mindset into the 21st century.

“We found it was easy to find these specialists or people that we could hire for a certain amount,” said McConnell, the CEO of Qittle. “We didn’t have the extra overhead and we just got the project done. It’s really easy for us to ramp up our needs or pull back using contractors. If we had an internal staff it’s pretty hard to fluctuate like that.”

Qittle’s new preference to hire its workers through the use of the Internet is shown in Elance’s most recent survey that reveals 83% of small businesses plan to hire half their employees and contractors through online means within the next year to year and a half. Only 10% of those who participated in the survey plan to hire onsite workers as the majority of employees (90 percent).

Elance, which serves as a marketplace for online workers, has posted more than 600,000 job advertisements ranging from virtual assistants to programmers. Small businesses choose to hire online workers because of economy of the process cost, speed and flexibility, according to Fabio Rosati, the CEO of Elance.

“So if you’re a small business owner, you can think of a hybrid model of hiring (online and onsite workers),” Rosati stated. “You can think about what skills and what talent you need onsite. You can also decide what skill set you need to be in the cloud which is much more cost-effective and much more flexible.”

Elance’s Online Employment Report revealed the number of businesses hiring online has increased 107% since last year. Elancers earned 51% more last year and earned a record $38 million in Q3 2011.

Rosati said more and more companies will decide to hire through the Internet. “I predict that at some point 99% of businesses will have between 5-10% of their hiring done online because it makes so much sense.”

But for McConnell, hiring online is the only way to go. Qittle plans to only hire workers through the Internet. “As a business we’d rather stay small and nimble and we’d rather contract out through individuals or businesses.” Doing so helps small businesses save money, because it does not spend as much money in overhead costs. When hiring onsite employees, small businesses must spend more on office space, utilities and other miscellaneous expenses with each new additional employee. Plus, hiring contractors instead of employees gives the business greater breaks with zoning, the IRS and other regulations enforced on those with a number of employees. While you do not have as much control over contractors, the benefits often outweigh the downside.