Freelancing on the surge?

Contrary to my earlier posting about what I have noticed on the free lance job market, oDesk blog has a post which states, with actual data from oConomy to back it up, that free lance jobs are on the rise.

Their commentary also makes the point that though companies are laying off employees the actual work that needs to get done remains more or less the same. And the smarter and leaner companies are turning towards free lancers to get these work done, rather than having full time employees to this work.

From a company stand point, this makes perfect sense as having a free lance employee costs them a lot less overall. They do not need to pay them any other benefits rather than the fees for the assignment. Also, since more and more people are joining the freelance workforce, with the rising un-employment rate, the competitiveness in the freelance market is going up, driving prices down. There simply is more supply than demand.

Another interesting factor they have noticed is that the number of home-shoring projects have gone up, meaning more US based freelancers are being hired. That is not very good news for other providers from the other part of the world, like India and Sri Lanka. According to their statistics, the number of Russian providers who were hired on oDesk have gone down, while India is still pretty much holding on to it. USA providers being hired are on the rise. So the out-sourcing market is turning out to a home-shoring market and not an off-shoring market.

The facts in this post are pretty bad for my situation, as a provider from Sri Lanka, I am one of those who are badly affected according to this data. And with the current employment situation in Sri Lanka also being on a hiring freeze, this leaves me in a rather perilous situation.

So what can I do to make my situation better? What creative ways can I use to make myself an attractive prospect to the buyers?

• Should I strive to acquire the niche skills that are in demand? If I do, what are the chances of breaking into a project without any references to show for that skill being used prior?
  
• Should I lower the rate I charge? As I have mentioned in my previous post, I have lowered my rate already? Lowering it more would require me to work night and day, just to earn enough to stay afloat.
• Any other ideas?