Consultants have bucked the trend in hourly rates, seeing increases at a time when salaried electrotechnologists are losing ground. However, the 2004 IEEE-USA Consultants Fee Survey shows that a slight increase in rates did not prevent a drop in annual median income for these same contract engineers.
Although median fees increased an average of $10 to $110 per hour since the last survey in 2002, median income dropped $20,000 to $100,000 in 2004. That's much larger than the $1,500 median income decrease reported in the 2004 IEEE-USA Salary & Fringe Benefits Survey (http://www.ieeeusa.org/communications/releases/2004/122204pr.asp).
"The drop in consulting income fits the trend of engineering salaries in general," said Bob Gauger, consultants survey director. "Engineering income is down, and our survey fits in with that, even though the fee is up $10 an hour."
Consulting incomes fluctuate because hours vary widely, with nearly half working 20 hours or less. Most consultants, 57 per cent, make more than $75,000, with 22 per cent making between $75,000 and $125,000.
A majority of consultants, 58 per cent, charge between $75 and $150 per hour. That rate is substantially higher than engineering wage rates because consultants cover many expenses such as health care. About 15 per cent charge more than $175 per hour, about the same as the percentage who charge $75 or less. Hourly rates are a key factor of the study, conducted in even-numbered years.
"There are many ways to set fees, but all of them involve knowing what your competition is charging," Gauger said. About three fourths of consultant charge by the hour, with a few using daily rates or fixed project pricing.
High wages are justified in part by experience. Seventy two per cent have more than 20 years experience, and 40 per cent have an M.S. or Ph.D. The majority, 61 per cent, have been consultants for less than 10 years, suggesting that many retired salaried engineers become consultants.
"Consulting is a tremendous way to cap off a career. You've learned a lot and it's great to get paid for it on your schedule," Gauger said.
Companies appear willing to pay dearly for some experience. More than 10 per cent charge more than $200 per hour, with half of them charging in excess of $275 per hour. Expert witnesses/forensic experts charge the highest hourly rate, $217.
The survey of 756 independent consultants was conducted by the Alliance of IEEE Consultants Networks. You can view the survey report at http://www.ieeeusa.org/business/files/2004FeeSurvey.pdf
Source: Eurekalert & othersLast reviewed: By John M. Grohol, Psy.D. on 21 Feb 2009
Published on PsychCentral.com. All rights reserved.
The probability that we may fail in the struggle ought not to deter us from the support of a cause we believe to be just.
~ Abraham Lincoln