Another question on salary 6

[newengie]

Hello all,

I'm a fairly new engineer with a little over a year experience working for a mechanical engineering design firm in Northern California. I am making a little less than 20% of what the company charges. I haven't been in this field long enough to know if that kind of pay range is what I should be getting. Any input/advices would be greatly appreciated. Thanks!

newengie

 

[SomptingGuy]

When I was a newish grad doing consulting work I was making about 20%-25% of my chargeout depending on the profit on the job. About half of the chargeout was "overheads".

- Steve

 

[swivel63]

i was 25%, as soon as i got my PE and SE i went to like 20%

LMAO

 

[KENAT]

It depends on industry but 'charge out rate' can have very little relevance to what you personally get paid. It depends on what overheads are lumped into the charge rate. By company what is considered overhead and what is direct cost can vary. It can also depend on what deals have been cut with the vendor etc.

At my first job in similar situation I was getting equivalent of maybe 25% give or take (different contracts had different charge rates).

I really don't see the obsession with comparing your pay to what the company charges for your time. There are better ways to assess your pay.

KENAT,

Have you reminded yourself of faq731-376 recently, or taken a look at posting policies:

http://eng-tips.com/market.cfm?

What is Engineering anyway: faq1088-1484

 

[TheTick]

Start your own business and then you can start giving 99% of your chargeout to your employees and debtors.

 

[newengie]

Steve, thanks for the reply.

Most of my hours were charged to training for the first few months when I started. Now that I'm sort of up to speed, I get told how many hours are expected of me for each project. So, 20-25% is the standard?

 

[IRstuff]

That's not necessarily out of bed. In defense, we have what's called the "wrap" rate, which includes the lights, your office space, your computer, the utilities, your office equipment, your benefits, your unemployment insurance, your supervisor's time, etc.

The list is quite long, and factors of 3x to 4x base salary are not unusual at all.

TTFN

FAQ731-376

 

[EQguys]

newengie:

To be absolutely honest, all said and done, as of now, dont worry about your salary. Learn as much as you can and develop your skills. Make everyday of your job worthwhile and learn as much as you can. Money will eventually follow. No good can come out of trying to figure out how much you are worth. At least not in this early part of your career. My humble 2 cents.


"Does the man make the journey or does the journey make the man" - Mark Twain

 

[SomptingGuy]

newengie,

You can up this percentage significantly by contracting (at least in the UK). But you'd need to be completely clear about the potential downsides.

- Steve

 

[KENAT]

One being that the rate you can charge as an ineperienced contractor is probably a lot less than your current company can charge for a task performed by a junior employee.

KENAT,

Have you reminded yourself of faq731-376 recently, or taken a look at posting policies:

http://eng-tips.com/market.cfm?

What is Engineering anyway: faq1088-1484

 

[SomptingGuy]

Some of my contemporaries left their permanent employment and returned next day as contractors. Customers got charged the same. The former employees earned more. Their lack of benefits (holiday mainly, healthcare is free here) was outweighed by the extra ££.

They were shown the door as soon as times got hard. This was the downside. Plus having to do all that boring tax return stuff.


- Steve

 

[davidinindy]

"They were shown the door as soon as times got hard. This was the downside"
That can happen whether contract or not... I've been there in both positions.

David

 

[SomptingGuy]

I guess you're probably describing the benefits of living in the land of the free?

- Steve

 

[vc66]

Sompting, you really don't like America/Americans, do you?

Some of us are OK, I promise.

V

 

[SomptingGuy]

I love loads of things about America, loved my time living there and would do it all over again if I had a time machine. I have many American friends too.

Employment contracts and healthcare though. Yikes!


- Steve

 

[KENAT]

Sompting, I was talking about setting up your own company, seems you were talking more about contracting on site.

KENAT,

Have you reminded yourself of faq731-376 recently, or taken a look at posting policies:

http://eng-tips.com/market.cfm?

What is Engineering anyway: faq1088-1484

 

[PeterStock]

"They were shown the door as soon as times got hard. This was the downside"

I have been kept on as a contract employee when a direct was let go, but mostly the contractors are the first to go.

Peter Stockhausen
Senior Design Analyst (Checker)
Infotech Aerospace Services

 

[SomptingGuy]

Both really.

It is/was common for engineers here to set up their own companies and then go to work at the same place the next day. The company thing is just for tax purposes.

- Steve

 

[Ron]

newengie....typical multiplier for a design firm is around 4 so you might be a little under with your 5 multiplier. Prove your worth while the economy sucks, then think about moving up. Wouldn't be wise to take a shot at the moment.

 

[newengie]

Thanks to all the people who provided helpful information. I appreciated it. I'm not looking to request for any kind of salary increase in this kind of economy, but wanted to see how I am doing compared to you all when you were entry levels.

Now that I realized I am underpaid, I'll know what kind of numbers would be reasonable to throw out there when the time is right.

EQguys,

Thanks for the great advice. I like the company, I enjoy what I do, I have great mentors and I'm also learning at a good rate. It's just that, while I'm at it, I'm also trying to bring home as much bacon as I can.