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Comment by kaisdavis | Hacker News Reader

I bill $60/hr. When I start to reach capacity, I multiple my rates by 1.5 for all new clients. I can see myself starting to bill out at $90/hr by June, 2012.

An interesting follow-up question for the freelance community could be how many of us employee freelances beneath us.

I've added a freelance copywriter and designer to my team and it's a joy to be able to work with and support another freelancer as they develop their practice. It's also a joy to have some of the capacity problems resolved by the addition of another set of hands. (:

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What do you do? $60/hr sounds low for Rails, iOS, Python, or serious database work.

If you can see yourself billing out $90/hr in June, 2012, why not try this experiment: bill yourself out at $90/hr (actually, $720/day, please) in January. See what happens.

If there is one thing HN people get wrong about consulting, it is that they relentlessly undercharge. It's easy to see why: the stuff they do seems easy to them. It's not easy. There is a worldwide shortage of real, viable talent. Companies are falling over themselves to attract and retain dev talent. The stuff you are doing is not cheap.

If you are billing at a rate that matches what a good full-time Google employee makes, you are wildly undercharging; freelancing is expensive (you are responsible for all your own taxes and your own benefits, and for providing a cushion for yourself for dry spells) and the service you provide (flexible, on-demand work without bringing a full-timer on) is extremely valuable.

CHARGE MORE.

"There is a worldwide shortage of real, viable talent. Companies are falling over themselves to attract and retain dev talent."

I have to say I find that hard to believe.

Now, to be fair I don't actually know if I am talented or not. It is impossible to accurately judge oneself, though I like to think I am. I've had the opportunity to play lead on some pretty big and successful projects for some major businesses using many of the technologies that are said to be hot right now. A present co-worker said something to me along the lines of "I have worked with a lot of programmers, and you are by far the best of them" and it seemed genuine. Take from that what you will.

Anyway, I've entertained the idea of working with some other organizations. Some have not been interested in me at all, and the rest were no longer interested after a short chat. Nobody has been interested in seeing the actual quality of my work. I'll accept that I just don't have that talent, but given the above, it seems to me that it is really just my marketing skills that are lacking – Which makes sense; I spent my spare time becoming a better programmer, not becoming a better marketer.

Given that, I remain skeptical of the talent shortages. How much comes down to companies just having no clue about how to hire people?

I'm sure you're great, but I've been hiring people nonstop for almost a year now, and networking with people who are also hiring, and the fact is: it's a tight market for dev talent.

Is the market efficient? I'm sure not.

But if you are passing over good talent because of external reasons (such as poor marketing skills), is it fair to say there is a technical talent shortage? The talent is there, you're just not interested in using it.

And it is completely fair for a business to seek a well rounded person. If you want someone who is good at marketing and development, you are more than welcome to look for that. You are under no obligation to hire anyone less. But it is not the technical talent that is tight.

Anyway, hopefully I don't come off as sounding bitter or something. I have an amazing job already and respect anyone who feels I am not a good fit for their organization. I just have to wonder if the shortage of talent is real, or if companies are passing over real talent for other reasons unrelated to the lack of skill in technology.

It's not a tight market for dev talent at all. There are so many programmers out there and not nearly enough positions. Those that do exist now will be rapidly drying up due to industry slowdown and consolidation.

... in Outer Zambonia.

No, in the Bay Area. There are tons of programmers here who can't find jobs. There simply aren't enough positions available for even talented programmers to find work.

If they are talented, tell them to email me (my first name at identified dot com). We're trying to grow our dev team rapidly at Identified, but we're limited by the number of good developers we can find. If they're good, we'll hire them.

Edited to add: We're located in the SOMA district of San Francisco.

This is of course counter to everything everyone else ever says about the job market in the Bay Area.

Edit: not to say you're necessarily wrong btw, just that there may be a higher standard for "talented" out there. Local maxima and all that.

Do you currently need a good remote Node.js/MongoDB developer? (That's my current preference. I do everything except Ruby/Perl/.NET. Sizable experience with AWS, App Engine, Linux admin, SQL, you name it.)

Which makes sense; I spent my spare time becoming a better programmer, not becoming a better marketer.

Good. You need to be a problem solver, not a programmer. You need to listen to your customers and find solutions. That's how you show up the value you make.

I agree with you entirely. However, that is not a deficiency in a technical skill. You cannot really say there is a shortage in technical skills while at the same time passing over technical people because you find them lacking in non-technical areas.

If you can't make use of your technical skill (solve the problem) you definitively don't have it. That's why you need to be a problem solver in the first place.

I'm not sure I agree with that.

I farm as a hobby, so I see lots of unique problems. In typical programming jobs you're just stringing together the work of others. There's lots of book learning to do, but not much actual problem solving.

There are people solving real problems, but those kinds of jobs are fairly rare, and often not very well paying when done in academia. Implementing working implementations based on those already found solutions are where the jobs are.

Listen to this!!!

I need to remind myself of it more often than not, but it was once again driven home to me last week. A new (prospective) client wanted something (an electronic design) so trivial I couldn't believe he was even asking. But the point was that it represented real value to him (read: stuff he can resell for lots of $$$) for me to connect two simple parts together with a bit of wire.

Oh, quick sidenote: you'll find that people are arbitrarily consistent around particular price points. $720 is a bit weird for a day rate, so just bump it to $800, since you'll have exactly the same resistance to $800 as you would to $720. Oh, BTW, you'll have exactly the same resistance to $1,000 as you will to $800. (Not much, incidentally, from good clients.)

There, you just more than doubled your income and your customers will not perceive you as being more expensive. (I know I know I know trust me on this. If they were mental math experts then they would be programmers and you would have money.)

You know what's interesting about the comments on this story? You're posting a lot of comments telling people to charge more money because the work they're doing is valuable and the market is tight, and almost all of them are telling you why you're wrong!

You're basically handing people free money and they're too busy adjusting their plastic sheriffs badges to accept it. As if it were somehow dishonorable to charge your value in the marketplace. Craziness.

I'll inflate my ego here, and state for the record that I'm a pretty darned good consultant, with many satisfied clients over the years and lots of projects under my belt.

Regardless, people in Israel totally freak out when I tell them that I want to charge $100/hour. For Web technologies, that's considered an unheard-of high price. If I were to ask people for $150/hour, they wouldn't even negotiate; they would say "no." And I speak from experience.

(In case you think that I've only worked with small startups that are hard-up on cash, I've negotiated consulting deals with large Israeli and multinational firms in Israel. The response was similar.)

Charging more for a valuable skill set is totally OK. But you can't assume that every consultant on HN can simply increase their rates and get what they're asking for.

I should add that one solution I've had to this issue is to get some work outside of Israel, working remotely for people in the US, who tend to be more flexible on consulting rates.

Absolutely. There's no reason to limit yourself to any geographic particularity in this kind of work (especially going up against the "I'm not a sucker" voice in many Israelis' heads).

Rather than viewing your pool of clients based on geography, it's more sensible and realistic to view it based on potential clients' need for your particular skillset or language or system, wherever they are.

US is still likely the main source of work, and some want US-based people only, but I'd say that's a minority. And it sounds like your English is native, which probably helps.

Thanks for the encouragement, tptacek.

> What do you do?

Marketing strategy, SEO, Social, Websites, Adwords, Print.

> Why not try this experiment: bill yourself out at $90/hr in January. See what happens.

You're right. There's nothing that will happen that qualifies me for $90/hr in 6-months. All that changes is charging more for the work.

Thanks for the encouragement, tptacek.

Suppose you make $100k as a salaried developer, which works out to about $50/hr. What would be an appropriate, approximately equivalent rate to charge as a consultant?

Edit: For an American at least. I guess what I am more curious about is, what is the overhead for things like taxes, decent health care coverage, and insurance against dry spells?

You should end up grossing 30%-50% higher than FTE, because your cost structure is worse:

* You own both halves of payroll tax

* You're out probably $500/mo in benefits

* You have no paid vacations or sick days

* You need to smooth out income for dry months

On top of that, contractors offer companies a huge benefit: getting work done on (relatively) short notice (plan-hire-rampup for an FTE can take 6-9 months) with no commitment (you can't hire an FTE to build a simple CRUD app and fire them when they're done). Your prices should reflect not only the (probably superior) technical acumen you offer, but also the structural benefit of working with contractors and not FTEs.

Long story short, you should be making MUCH more --- on a "per project, projecting the rate over an entire year" basis --- as a freelancer than as an FTE.

It has also become practical for me to employ a freelancer to pick up some of my freelance tasks. So far, it seems like one of the best ways to scale my work while focusing only on the tasks I enjoy most.

My rates and procedures are the same. Although, when clients expect me to rush design/build their work I bill 1.5 or double depending on the time frame.

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