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Ask Lawrence: How much am I worth?

26 Sep 12:00 by Lawrence Akers

Lawrence Akers Pay Money

Hands up if you feel like you’re being paid fairly?

When I thought about writing this blog this week, I knew that it was a topic that had to be discussed with a bit of sensitivity. After all, we are talking about one of the main motivators and drivers as to why people do their job. It may not always be the main motivator however it will always certainly be up there because, let’s face it, people need money to live! I personally have ‘job happiness’ as my key motivator - as long as I have a happy environment and as long as I am making enough to live on, then I am in a great job!

I absolutely believe that we all have a figure inside us that we believe we are worth. I know some people struggle with identifying that figure however, even if I was to ask them to consider a ‘range’, they’re able to come up with some indication of the dollar value that would need to be offered to make the opportunity one they would consider.

Trying to determine that dollar value can be a tricky experience. Firstly, you have to weigh up your own level of industry experience, factor in if there are any niche skills being offered, benchmark it against what the industry standard is (if any) and then weigh in other factors such as the cost of running your own business or accepting work through an agency.

Let’s have a look at these in a little more detail.

Industry experience

As a starting point, your level of commercial industry experience needs to be taken into consideration. If you’re relatively new to your industry, chances are that you have to reduce your rate so that you can gain the industry experience to increase your rate. With industry experience often comes speed, accuracy and ability; I recall a story of a woman who called a plumber to come out to fix an issue she was experiencing. When he arrived, he spent a few minutes assessing the situation, a further few minutes more to pull out some tools and make some adjustments, and then presented his invoice to the client.

“$200!”, she exclaimed. “That seems an awful lot of money for a couple of minutes work.”

“Yes”, he said. “Sure it was a couple of minutes work, but it was a decade of experience that allowed me to do what I’ve done in a couple of minutes.”

Some industries are inevitably going to have greater difficulty in ‘justifying’ their rates to clients who just don’t ‘get it’. Talk to any designer about this and they’ll tell you of people offering them a couple of hundred to do a logo because ‘surely it only takes a half hour or so?’ Recruiters frequently have to justify their rate as what we provide is ultimately a professional match-making service and, again, as you can’t physically hold the product in your hands, it seems that it can be harder for people to grasp what we do. Perhaps the perception is that we sit around, drinking coffee and wine, browsing CV’s and being shady with people who don’t meet the mark however the reality is so much more intense, beneficial and worth every single dollar that we charge.

Niche experience

Having said all that, having a point of difference along the lines of ‘ten years industry experience’ is just not going to cut it anymore. I’ve had many Senior Designers sell themselves to me with a line like this and, to be honest, there is a large group of people out there with the exact same claim that they can use. That just doesn’t offer value anymore.

If you want to have your experience translate into value, then talk niche. What is it that you do that not many other people do? Sometimes it might be the jobs that everyone hates (I’m looking at you Microsoft Office) or it might be an expansion into an area that is a growing trend (print designers who have moved into the digital space is the obvious one in the creative world). 

I live in a heritage listed building. Do you know what the quote is to maintain our guttering and roof? Do you know why? Because there aren’t as many people who have experience and a niche in that area. It’s basic supply and demand; if they’ve got the skills and experience, then they can charge what they want. Niche has value.

Industry standards

This can often be a hard one to benchmark. You could look at the salary expectations on job ads. You could talk to a recruitment specialist in that area and ask them to value what they believe your position description is worth. Ultimately, you could have two nearly identical job descriptions in two different industry sectors and see a massive difference in the salary being offered. Even within the creative sector, trying to find an ‘industry standard freelance rate’ on copywriters or illustrators can often be a challenge however it is worth knowing simply so that you can better your chances of being competitive in the market (unless you’re uber-niche and can get away with charging whatever you like for the skills you’ve so wisely developed).

Find the industry standard; if you’re too low, consider what you believe it is that has reduced your rate. Is it lack of experience or do you simply undervalue yourself? Is Imposter Syndrome coming into play and you’re believing you don’t really have the skills you need to be successful? If you’re too high, what do you have to justify that additional cost above your peers? 

Running your own business

If you’re running your own business, you will need to factor in other things like if your client pays on time. We’re talking cash flow here and, for small businesses and freelancers, this is a massive challenge. If your client is not prepared to pay at least a portion upfront (or weekly), then you need to consider what kind of dollar value this financial liability has on you. Have you ever done calls chasing up outstanding debts? They’re a hoot and people love them. (Yes, that was me being sarcastic). I’ve heard of freelancers who went six months chasing up pay they were due. The upside is that you can charge a lot more. The downside is that you open yourself up to far more potential issues.

Through an agency

The downside of going through an agency is that you will get paid less as they have to factor in the payroll costs and their own margin on the job, and it needs to be kept within a realistic rate for the client. Some recruitment agencies are better at handling this than others and often this involves the recruiter pushing back on the client to ensure that the client understands what a reasonable rate is going to be. Ultimately, the recruitment agency keeps to be paid to keep the doors open. The upside for the candidate is that they get paid quickly and the client has recourse if things don’t work out as planned.

With all these factors, it can be understandable why people are unsure as to how much they should put themselves forward for. My advice is this; do a budget and determine how much you need in order to live and to enjoy life. Work out what that dollar value is. Consider if it is a realistic dollar value; if you’re used to champagne and the work isn’t coming in, maybe it is time to discover some nice beers until things pick up. Not knowing what you are worth is worse though as you’re just allowing fate to determine if you have enough to pay your bills and put food on the table.

Consider what avenues you get your work from and try to get work from each revenue stream. If you’re not getting work directly and an agency calls with something that is less than what you would take direct, go for it. At least then you know you have that money coming in quickly and it is better than sitting on the couch, watching Netflix and stressing about where the next job is coming from. It also allows you to get in front of more clients, which can translate to more work, and potentially develop new skills. 

If you have any thoughts, questions or simply would like to get in touch with me and offer up a topic for the next Ask Lawrence, you can contact me on lawrence@creativerecruiters.com.au or you can find me and connect with me on LinkedIn. 

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