Replies to This Discussion

Permalink Reply by Ralph Winters on January 31, 2010 at 10:58am

Not really sure why the $300/hr would not be better. If someone is regularly commanding that rate, they are surely doing something right. If you are getting a lot of work at $30/hr, you may be in a competitive commodity market and that is bad, at least for you.

-Ralph Winters

Permalink Reply by Titus on January 31, 2010 at 12:07pm

My patent lawyer has always charged $500/hour (working on analytic-related patents), even today, and he's still quite busy. But I believe his firm laid off a few people. I think in this economy, you see some consultants with rates dropping from $150 to $0 (no more work) and some keeping they full rate and barely impacted by the crisis.

But $300 for analytic consulting is rare - unless you work in highly specialized fields or statistical litigation, or your effective rate is $300 when you actually advertise a much lower rate (e.g. you ask a flat fee rather billing by the hour). If all you do is standard regression and modeling, SAS analysis, presenting reports etc. your rate will be between $45/hr and $120/hr in US. You might work for a consulting firm that charges the client a much higher rate, but these firms take a very large commission.

Permalink Reply by Clifford Ang on April 4, 2010 at 12:41pm

There is much more going on than just a matter of taking home $30/hour versus $300/hour. First, the rate that you charge is most likely a market-determined rate. That is, if clients are willing to pay you $300/hour of your time, then you should charge $300/hour. Many experts charge more than that, e.g., I know a few that charge more than $1,000/hour. The guy charging $300/hour can charge less to get more business, but the guy charging $30/hour cannot charge a much higher rate because no one will be willing to hire them at that rate. Second, if you work with a consulting shop so you can leverage off the consulting shop's people. You can also increase your take home pay by getting a piece of the billable hours of those working under your direction. The person that can most likely leverage off this is the one with the higher billing rate (i.e., it would be very awkward if the "expert" charges $30/hour and you have a lot of people under you charge $100/hour. Also, many arrangements allow the "expert" to keep what they bill. Third, $30/hour seems to be very low for a top "expert." Most major consulting shops have analysts that bill way more than that. Fourth, in my line of work, all costs and expenses are passed through to the client. So, international travel and, if necessary, hotel/food are all charged to the client.