Where do You Stand in the Web Development Industry? Part II
Last week I left off on the topic of organizational structure with a breakdown of web professionals who work in each different type of organization. This week I want to talk about the compensation results reported in the survey from A List Apart (http://aneventapart NULL.com/alasurvey2010/00 NULL.html) and how compensation is affected by the type of organization and level of experience.
Image taken from A List Apart survey results
As you can see from the chart, the majority of the respondents, about 60%, reported earning between $20 and $80 thousand a year. The median salary range, also the range with the highest number of respondents is between $40 and $60 thousand, at 24%.
Salaries Based on Organizational Structure
A huge difference between working for oneself and working for a business is pay structure. Generally, working for an agency or business of some type means working for a pre-determined salary or hourly rate. Your paycheck is not a function of the amount of work you did in any given two week period. Contrarily, if you work for yourself, your paycheck is 100% determined by the number of billable hours you work on projects. That’s right, I said billable hours. That doesn’t even include all the work you may have to do researching, learning a new technique, or getting your creative juices flowing. While this may seem stressful and unpleasant to some people, other people see the upside potential involved in working for oneself.
When the data is broken down to compare respondents in three different organizational structures, we can more easily compare ourselves to the data. The three groups I chose to look at are freelancers, employees in an organization, and partners in a small business. The majority of freelancers reported earning between $20 and $40 thousand per year, compared to employees in an organization and partners in a small business, where the majority of respondents claim to earn between $40 and $60 per year.
One trend that is apparent from the chart is that the concentration of respondents who are freelancers and small business owners outweigh the employee respondents in the salary ranges on either extreme end, while the employee respondents outweigh the small business owners and freelance respondents in the more mid-range salary figures. I would presume that this is a testament to the level of upside potential and downside risk involved when taking the self employment route.
Does This Impact Your Rate as a Self Employed Person?
If you are a freelancer or partner in a small business and you find yourself on the lower end of this salary range, you may want to consider the following when you determine your pricing structure. Are you accommodating for paid vacation or retirement benefits that you miss out on as a self-employed person? What about time spent on research and learning new techniques? My point is, there are always going to be clients who give you a hard time about your rates. If you can find a way to justify your quoted rate by putting it into the perspective of that of an agency’s rate, clients will find it harder to question how you came up with your quoted rate.
Compensation Based on Experience
The survey results indicate that workers in the web development industry are able to command a higher price the longer they work in the field. Based on my personal experience I have found this to be true. It makes sense in the fact that as time goes on, we learn new languages and new technology, which broadens our skill set and makes us more valuable and more marketable.
Putting in the Time
The majority of respondents with 1 to 2 years of experience reported earning between $20 and $40 thousand per year. The majority of respondents with 3 to 9 years of experience report to earn between $40 and $60 thousand, however, with every year of experience, a higher percentage of respondents fell in the next highest salary range.
Getting That Diploma
When it comes to education the results show that compensation increases the further we go in formal education. However, one thing the survey results don’t specify, is whether or not the degree is in the respondent’s line of work. These days it is becoming more common for people to earn a four year degree. But what I have found is that sometimes there can be a lag in the curriculum for web developers at four year colleges, and current industry trends and relevant technology. I’m not trying to devalue formal education by any means, but I would be curious to see the trend in tech or trade schools as an educational choice for web developers over the next few years.
Relevancy
The survey did however ask respondents how relevant they found their education to be with regards to their line of work. The results show that roughly half of the respondents find their education to be relevant to their line of work. Results vary slightly depending on the respondent’s level of income, but never by more than 5% either way.
There are obviously many factors that affect an individual’s compensation, but hopefully this data gives you an idea of what others in your industry are earning and some insight as to why. Come back next week for an overview of the skills being used in the industry and where you could fill in the gaps.
