So, a few days ago I was randomly scrolling through the Yahoo! homepage and came across this article from Monster’s career advice section. It talked about “Six High-Paying Contract Jobs.” Prior to clicking on the link, I thought to myself, “It’ll probably just include the usual creative type of jobs that seem to be mainstream in the freelance world.”
All do respect to those in creative type jobs by the way.
Anyway, to my surprise (as you can see from the article) Registered Nurse was listed first. Awesome! I enjoy hearing about other independent contractors, and not to mention how they’re fairing financially as salary does seem to be a big topic in nursing regarding the level of pay in return to the level of responsibility. Our patients’ lives!
I quickly noticed that the FTE (full time employee salary) was stated as $54,000/year. Hmmm. Are we talking new grads here? Is this right? I mean, I’ve checked out the salary.com site and have played around with the numbers, and still felt that it was a little off, but I did chalk that up to some of the salaries being based off of a 36 hour work week, area of specialty, and location. Not to mention that there are quite a few new grads that ultimately bring the range down a bit.
We all have to start somewhere near the bottom of the range, but in nursing as we climb the ladder it seems that the ceiling is hit pretty quickly, and definitely hard to justify it for what we do sometimes. I don’t want to get on that soapbox right now, but hey, this isn’t volunteer work!
What really stood out is the contracted rate. Now I’m going to write another post about the true independent contractor vs. the “13 week travel nurse contracts” to basically shed some light that the latter isn’t “real” contract work. In this article it states that the contracted rate is 22.4 percent higher than the FTE rate. Let me just say that if you’re getting that kind of raise as an IC, then you’re going to be losing money.
In my experience at a minimum you need to take your current FT salary and multiply it by at least 35 percent. Now, keep in mind some services you provide will have greater overhead, and some less, but don’t sell yourself short. In some cases I’ve seen calculations that have taken a salary and just doubled it. Now, the doubling option is a very gross calculation and may not be pertinent to your particular situation. Remember, as an IC, your paying for:
- Professional License (probably already doing this anyway)
- Liability insurance (a must!)
- Federal/State withholding (this is already withheld from a FTE paycheck anyway, so nothing in addition here)
- FICA (your share, and your business’ share)
- Federal and State unemployment withholding
- (The above tax situation is based on my experience as a corporate entity. Not to mention either hiring an accountant and/or having book keeping software and the time it takes to do these things.)
- Your office space (but you may work out of your home)
- Computer hardware and software
- A vehicle, and your mileage, which isn’t typically reimbursed by the hiring organization
- General office supplies, and don’t forget your basic clinical equipment that may be needed for certain positions
- Oh, don’t forget your salary
These are just a few things to consider when calculating your rate. Take the salary that you’re aiming for (what you think is fair for your level of expertise), break down your overhead and add this to your rate. I’ll also do another post of certain percentages, but this is easily searchable.
The message I’m trying to convey here is that many nurses feel underpaid and overworked. Remember how hard you worked to get through school/training? Not to mention all of the additional education and certifications that you might have taken (or continue to pursue) along the way? If you feel short changed at your FT job, then why would you do it to yourself?