How Much is Your Time Worth?

So you've had it with office politics, working for a badLet's look at an example: Pauline the PR professional!
boss and making someone else rich.Pauline can earn $145,000 a year working as the
You decide to quit and set up your own business.Communications Manager in the above example.
Before you do, you need to work out what your timeDouble her day job equals $290,000 in fees (2 x
is worth.$145,000)
Take this typical job in PR as CommunicationsLets then add the 25 per cent (25 per cent of
Manager for a major company in a big city.turnover) for a lean operation running costs.
Here's the headline of the job in the weekend paper.She now has a calculated budget turnover of
Corporate communications role, big office near a$362,500
major park, full-time staff position with salary of $145k+Divide this by 100 saleable days a year equals a day
superrate of $3,625.
This is the job description when you first applied.Now here is what usually happens according to Matt!
"Our new communications function plays an importantPauline or any other professional moves out of her
role in the management of internal/externalday job as advertised above and starts to think all she
communications, reputation risk and providing expertiseneeds to do is replace her salary. Matt reckons this is
in community relations."a seriously bad move!!"
Reporting to the General Manager, Business"They then divide this by around 220 days a year.
Development, your responsibilities will includeThat's a lot of hard work for very little money."
coordinating internal and external communicationsIn Pauline's case she would have a day rate of approx
initiatives, including publications and the intranet; media$650!
relations, assisting in the implementation of externalNow, I've even seen PR jobs advertised as low as
stakeholders strategies; providing counsel to projects in$19.50 an hour! Why is this so low compared to a
the management of community engagement; preparinglawyer four years out from law school who earns at
speeches and presentations on behalf of seniorleast $400 an hour?
management; and maintaining an emergency and crisisI argue an effective corporate communications
communications management plan.professional will add more value to a business than a
Essential skills and experience require ideal candidateslawyer any day!
to have proven experience in delivering enhancements"Don't let anyone tell you that your day rate when
to internal and external communication. Minimum 5compared to an employee is way too high. The on
years experience in external stakeholders relations iscosts and base costs in a business will smash you
essential as is oustanding written, verbal andevery time. As an aside, smart doctors share
interpersonal communication skills."resources to drive down the base costs," Matt says.
So let's take this fictional role and compare it with whatAccording to Matt, if you don't value your time
you would need to earn if you ran your own PRcorrectly 3 things will happen;
business.1. You will find yourself earning lots and taking home
One of the speakers I most admire, Matt Church CSPnothing.
provided the inspiration, insight and permission for the2. You will work way too hard and not have any time
basis of this article.to develop new business
"Don't give up your day job, well not unless you value3. You will constantly think you should go back to a
your time correctly," Matt says.day job!
He says the focus is on how you value your time if"In a practice based income business model,
you run your own company compared to working fortake-home is king not turnover! So pay yourself first
someone else in the job mentioned above.and don't sell yourself cheap!"
"What do you need to earn for the year? There areThis is really valuable advice for people wanting to run
two figures to consider here; Your annual "turnover''their own PR, media or management consulting
from fees and your specific "take home" before tax.practice.
As a simple rule of thumb, those of you comparingAnd how do I know? Well, over the past eight years
your income equivalent in a day job should look at anof running my own business, I've been there and done
annual turnover at least double your potentialexactly what Matt says you shouldn't do.
professional salary. In most cases it needs to beI was so tight for cash flow at one time, I spent the
double plus 25 per cent; the 25 per cent factors in leanweekends renting my office carpark to football fans
running costs," Matt says.just so I could survive.
"You should then divide the grossed up figure by 100Fortunately, I've learnt and been able to turn my
days and you get close to your day rate. As you playbusiness around through fair and value-based pricing.
with this you can start to get clear on what you needAnd of course that's the value of having a mentor or
to earn as a benchmark each time you sell what youcoach. Someone who has been there before and can
do."advise on all the pitfalls.