Let’s Talk About The Day Rates

coins on handI was halfway through a post in response to Debs’ latest blog in the ongoing conversation with her and Naomi Barnes and Katie Collins when I was stricken with a chest infection. One of my disabilities is asthma, so these things hit me hard, and I’m now in bed, on steroids, coughing and wheezing and waiting to feel better. My brain isn’t working too well so I’m going to write a post inspired by a real-life conversation with my friend and collaborator Katy Vigurs earlier this week, about day rates. Katy told me it would be useful if I explained how they work. So here goes.

My day rates are between £250 and £550. Generally speaking, I offer the lowest rates to small charities, medium rates to national charities or charitable funders, and the highest rates to the private sector, central government and universities. Having said that, I will negotiate, and may offer a lower rate if it’s work I particularly want to do, or I’m feeling flush and it’s a good cause, or it’s a low-hassle job I can do from home. I may charge more for work I don’t really want to do or which will involve lots of travel or unfunded collaborative extras.

So my median rate is £400. That’s fairly low by the standards of most of my competitors, but seems high to salaried people. They wonder how, if I am self-employed and work from home, I can justify charging so much. Partly this is because I am an expert and have a wide range of skills and abilities to offer. More prosaically, it’s because of the economics.

Let’s start with holiday pay. If I take a standard level of holiday – 4 weeks per year, 8 bank holidays, and 104 weekend days – that leaves 233 working days in the year over 48 weeks. In theory, therefore, I could bring in £93,200 each year. In practice it doesn’t work that way.

I need an average of one day per week for essential business-related tasks: marketing (including writing these blog posts), keeping up to date with my field (oh the never-ending reading!), administrative management of my finances, my office, and my paperwork. So now I’m down to 185 chargeable days per year. But there is other work I can’t charge for. Lots of other work. Pre- and post-contract work, hold-ups caused by clients who cancel meetings at short notice or don’t meet agreed deadlines, writing journal articles, replying to queries via email and Twitter, my own professional development. Nobody pays me for any of that. If I do a day’s work at your university, it’ll be around two days’ work in reality, with all the planning, preparation, and follow-up work. And travel. There’s lots of travel. Sometimes it’s included in the day rate, but I would estimate about half of it isn’t. So overall that’s another day a week, so now I’m down to 137 working days. (Actually it’s more like another two days, which probably explains why I mostly only have one day off at the weekend.)

Then there’s sickness. The average annual sickness absence in the UK at present is just 4.4 days per worker, though there are suspicions that this hides ‘presenteeism’ i.e. turning up when you’re not fit. I certainly do this, because I hate letting people down, because if I don’t turn up I don’t get paid, and because I need people to know I’m reliable. Though sometimes, like today, I just can’t. I’m supposed to be chairing an event in Cardiff tonight for the SRA – expenses only as I’m on the Board, so at least I’m not losing income, but I am gutted to miss it and to let them all down. So let’s say another five days per year on average for sickness, leaving 132 working days.

At £400/day on average, in theory I could make £52,800 per year – though that would be pre-tax turnover, not profit. But it is very rarely possible to secure paid work, at my median rate, for every available working day. In reality, last year, my turnover was just over £25,000. To work out how much I can pay myself, I have to deduct all my business expenses: heat and light for my office, accountants’ fees, subscriptions, IT equipment, telecomms costs, stationery, books, etc. I have to put away a big chunk of my turnover, usually around 20%, for tax, which I pay once a year. And I need to keep 6-12 months’ running costs in the bank in case of lean periods or cash-flow problems. For the last year I’ve been able to afford to pay myself £1,000 per month. I’m hoping I can continue to do so, as dropping below that means some belt-tightening. But there are no guarantees.

I’m not writing this post as a complaint. I love my lifestyle. It buys me my greatest luxuries: time and space. I am writing this post to debunk the assumptions people have about me: that because I’m an expert, a published author, a Fellow of the Academy of Social Sciences, my income is commensurate with all those status markers. It’s not. The world doesn’t work like that any more.

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