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You tell whatever story you want to tell. What’s wrong with freelancing, especially if that’s what you’ve been doing?
You can also phrase your leave in a way without saying you’ve been laid off. I had another situation, I quit from a large corp, that laid off people right after, and recruiters didn’t even ask, they immediately assumed I was laid off, I had to correct them, but it was almost a no brainer to them, that of course, I was laid off (I was not, I resigned even before any rumors).
Tell them whatever you want to tell them. Especially in this economy, recruiters don’t care or judge those laid off.
I was turned down for a job last year because the company wanted somebody who was already in a full time role.
Freelancing
Tell them you are looking for your next role
It’s a full time job
Why would you omit that you have been working freelancing?
Rising Star
Definitely freelancing.