Setting Writer Rates: It Costs Money to Make Money
It never fails to amaze me that people expect me to write for less than $5 an hour. I’m not a sweatshop writer, nor should any other writer out there be subject to those conditions.
Most of us are legitimate, self-employed workers or registered businesses. We pay expenses to earn income, declare that income, and pay our fair share of taxes. An online business doesn’t mean under-the-table earnings.
Writers keep tabs on what it costs us to earn a dollar. Trust me, a good part of the money we make doesn’t go in our pockets.
Here’s a look at what factors determine the rates I charge:
- Canadian minimum wage: $8 an hour
- Internet expenses: $40 a month for high-speed connection
- Memberships and subscriptions: About $1,500 per year
- Website commission fees: Between 5 and 15%, depending on website
- PayPal Fees: 2.9% of all income
- Income tax: Between 25 to 32%
- Government licenses and registrations: About $200 per year
- Accounting services: $60 an hour
- Utilities: No electricity, no business
- Computer upgrades and software updates: The right tools for the right jobs.
This doesn’t include any extra expenses we need to stay tops. Books, courses, training, education, certification… the list goes on.
The false assumption is that writers live a life of freedom with very little expenses and low overhead. That’s not true. We may have less expenses than other online business and we may have the freedom to choose where we work, but we aren’t living the good life.
Before setting your own rates, take a look at your expenses, both short term and long term. It’s going to cost you to work, unfortunately; earning a living isn’t free.
16 Responses to “Setting Writer Rates: It Costs Money to Make Money”
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James, I can one-up you on the “$5.00 an hour” example with one about how well-intentioned folk expect us copywriters to work for free.
If you go to my blog and type in “free lunch” in the search box, it should come up. I’ve found this is one of the most common ways businesses try to finagle free work from copywriters.
You make some solid points about the factors that go into what we charge. I like the example my mentor Jay Abraham always used: “If I only ask a quarter for every dollar I make you, that’s a fair price, is it not?”
Btw, enjoy your blog. Clean design and good, solid postings. My favorite combo.
Wishing You Much Success,
Â
Walter Terry
http://www.ROIcopywriter.com – Greater ROI Through Strategic Sales Writing
I wish someone would take me out to lunch, Walter… preferably because they like my company, not because they want free help. Unfortunately, living in a rural area has its drawbacks (or is that fortunately, rural areas have their advantages?)
But I do agree. There are all kinds of subtle ways people squeeze writers for advice and recommendations – that’s consultation, folks, and that’s a payable service as well.
Thanks for the kudos on our blog, too. We’ve worked hard at it (and still are), and I’m glad to see it’s meeting reader expectations for quality all around.
I noticed on your site that to comment, we have to login… but… where do we register?
I’ll take you out to lunch James…the very next day I get off. Might be a long wait though, Louise keeps us all pretty busy, God bless her!
I really enjoyed this post and it is so true. As writers people often assume that we have the easiest life, working when we want and earning huge incomes. This is not always true and if you check out some of the marketplaces you will see what I mean. I have come across job listings for $1 articles. Can you believe it? Who would write a 500 word article for $1. I often wonder what is next.
Amanda
Plenty of people work for $1. Some live in countries with economies that make that dollar a small fortune. Some people assume that’s the going rate and just don’t know any better.
Some really need the money that badly. Kinda sad…
Yes James, I guess your right it’s just a pity that these $1 writers don’t realize that they are having a disastrous effect on the rest of us. We can’t possibly complete articles for $1.
I’ve stopped looking for work on forums because I was constantly underbid.
The only good thing about $1 articles is that they are usually shabbily written, and most of the writers who will work for those rates speak and write very poor English. Eventually, the client gets the hint that you really do get what you pay for and comes looking for quality writers with reasonable rates.
I still get my name out there on the forum profiles so that when they are ready to find a decent writer, my name is on the list, but bidding on projects is just a waste of time lately. It really is a shame.
Depends which auction site you frequent, I’ve found. GetAFreelancer, Guru, WriterLance and Scriptlance seem to be bad ones for low rates, with GAF taking first prize and Guru a real close second.
Rent-a-Coder has more opportunity, but there is an unspoken threshold that buyers cling to.
iFreelance and Elance are the best I’ve seen yet, with Elance being the best out of the two.
There are plenty of others (Directfreelance, off the top of my head), but my personal experience with those is fairly limited.
Feel free to add more spots to look for quality gigs – I’ll do a writeup on them.
Isn’t that the nature of business everywhere, though? For some people, $1 is a lot of money considering the work they do, especially if they aren’t from North America and aren’t able to get other jobs. I don’t begrudge somebody for trying to put food on their table and the low rates are the inevitable and inexorable results of a capitalist system in a constant state of flux.
So low rates for writers, $1 articles and such, are not resultant of the people taking those articles because the people taking those articles likely need the income. I don’t find it “sad” in the sense that they shouldn’t be taking those articles and should find higher standards. I find it sad that people are forced into those positions in the first place. But all over the working world, by and large, there are crappy jobs for crappy rates of pay. It’s no different that it should be that way when it comes to freelance writing, especially when there are no governing wage requirements imposed on companies and no organization to freelancing.
The other aspect of this is the experience factor. People with poor language skills are not going to be paid top dollar for their work in any field that requires English writing and communication. That’s just a fact. Poor quality work tends to have poor quality rates of pay, so companies have this expectation (that they’re going to be outsourcing and not receiving high quality work) so they pay referential to their expectation. If the work is of a higher quality, that is to say that “you” as a freelancer can prove it and have an impressive resume, I believe there is enough high quality work out there.
When I first started writing articles, I was amazed at the notion that I was actually getting paid for it. I would do an article in about 15 minutes, fresh and relative to the pay, and would get paid about $3. People would bicker over the reality of this situation on various forums, as there are others like me that are fast typists and fast researchers. The work was relative to the quality of pay: not amazing but not shoddy. In the end, I’m making $12 an hour by and large and it’s not a bad chunk of change for what was, to me, easy work. So that’s all relative, too. If it takes someone three hours to do a 500-word article, as it would take my wife and many others I know, even a $10 rate for that article is going to seem crappy. However, if that someone can do two or three 500-word articles in an hour, that rate isn’t quite so bad.
So what to do? Do the faster workers who can benefit more from low rates simply pass up on easy and relatively quick jobs? Or do those that need the money, however “sad” it may be, pass up on that work so as to hypothetically “raise the bar” for the rest of the industry? I’d say not. The reality is that the companies won’t pay top-dollar for easy work and the majority of the work out there is easy work, keyword articles, SEO content, etc. If companies don’t find workers to take their work on one forum, they’ll go to another until they do. Corporations never raise pay rates unless they absolutely have to, so with no governing body, union, or any other organizational ideology for freelancers (because that would make us *not* freelancers), things simply won’t change all that much.
Hey Jordan – there is the National Writers Union for writers who live in the United States. I don’t hear much about them, though, so I don’t think they do any miracles.
As for “sad”, that was in reference to the fact that some people need the money *that* badly.
Sad, to me, is when I see the local homeless lady pushing her garbage-filled cart down the street while muttering to herself and brandishing a stick, or the guy who sleeps on the school steps at night, roots through the garbage cans and gives his dog the first choice before eating his findings. I remember that there are many people who would be thankful for money of any kind.
But I disagree that acceptance of low rates doesn’t aid to keep rates low. You can bang about the quality argument all you want with a buyer. Their response will usually always be, “But I can get it cheaper elsewhere.” Buyers shop by price first. If they can get it cheaper elsewhere, they will.
While this may not be a major factor in low prices staying low (you brought up some good factors), the law of supply and demand is certainly one of them.
I don’t think the writer’s union you mentioned covers freelancing. There are several writer’s unions, essentially, but freelance writing is a sort of “take your life in your own hands” type gig, as we all know.
Given your interpretation of “sad,” which matches mine, you would think that acceptance of low rates is relative to how badly people need the money. So, therefore, they are obviously going to have to accept low rates to put food on their table.
I also agree that *most* buyers, not all because I have experience with exceptions, will shop by price. I essentially said as much when I talked about the reality of capitalism. Low prices, in a capitalist free market system (regardless of the particular trade, as we could be making toys and the same things would happen while we lose jobs and contracts to people in India), are the rule of law.
I merely suggested some ways that could combat those ideologies in *some* cases, as they’ve worked for me. Magazines, for example, tend to dispatch work by quality. I’ve worked on a few e-zines that, while price was important, were certainly looking for high quality work as opposed to $1 articles.
You have to frame the “low prices” argument, supply and demand and all that (which again, I supported in my post), in the right context. Keyword articles, SEO articles, and other things deemed especially “easy” work will certainly go for lower prices if the buyer can find lower prices. As mentioned, I don’t begrudge people for taking that work if they can do it. Part of free market systems is the choice of where to work, etc. BUT higher quality pieces, like articles for magazines or prominent websites, etc., will not *merely* go for the lower price. Quality has a factor, so if you can offer that quality they look for, you can play in that game with competitive rates.
Supply and demand, especially in this context, will always exist as long as people need to eat.