Reply to: Consultancy cutting rates by 40%

[GitMaster69]

Lots of contracts at the moment that used to be in the 500-600 pd range, now advertised in the 300-350 range, one agnecy called me if I was interested at 250
I say yes to all of them as some income is better then none and I will dump them as soon as rates go up again.

The same happened with perm roles, where I saw 90k last year I see now 60k max

I did that but the moment I say to an agent I'm in a contract they lose interest completely. I say that in current climate jumping is not possible

[LadyPenelope]

Really? Any evidence of that or just your own personal desires - any sane consultancy will be using a fixed percentage with the agency especially in this market where agencies are looking for new work...

Personal experience, actually. This was done to me in a previous downturn. I thought the client was underpaying me till I saw the agency invoice. Quite a lot off a daily rate for 8 months.

Not clear why it would relate to my 'personal desires'. Bizarre phrase to use under the circumstances. Currently working on a decent rate.

[eek]

Maybe work 60% as hard as you normally would? I suspect the agent may be taking a bigger-than-usual cut also, they would see the current climate as the perfect chance to do this and blame the client.

It also depends on how much you'd resent that sort of rate. Or if there's any marketable experience to be gained there that you can use in future contracts.

Really? Any evidence of that or just your own personal desires - any sane consultancy will be using a fixed percentage with the agency especially in this market where agencies are looking for new work...

[LadyPenelope]

Maybe work 60% as hard as you normally would? I suspect the agent may be taking a bigger-than-usual cut also, they would see the current climate as the perfect chance to do this and blame the client.

It also depends on how much you'd resent that sort of rate. Or if there's any marketable experience to be gained there that you can use in future contracts.

[AnthonyQuinn]

Market rates in my skill set contracts haven't gone down by 40%.
10-15% at the most.

That is rubbish. The fact that you (and i suppose others) went in for an interview at 40% below previous rate means that rates have gone down by 40%.

[LondonManc]

If it was a decent rate originally and you can now strip costs from your revenue - costs = profit equation then 60% of good rate is better than 100% of no rate. Up to you how much you need the work and would get bored staying at home. Take it but keep actively looking is the third way.

[TheDogsNads]

That's good news. Simple solution is therefore to decline this contract and go and get one that is just 10-15% below your normal rate.

Bizarre the OP started this thread saying rate for this job had been cut by 40% below the norm, later posted rates for their discipline havent been cut by 40% but is still going ahead with the application for the 40% lower role they first posted about!

[Paralytic]

Market rates in my skill set contracts haven't gone down by 40%.
10-15% at the most.

That's good news. Simple solution is therefore to decline this contract and go and get one that is just 10-15% below your normal rate.

[northernladuk]

This was my suspicion also.
But how can I find out?

What can you do about it if you do?

[BlasterBates]

This was my suspicion also.
But how can I find out?

There's no need, it is irrelevant to your decision. Either the client is taking advantage of you or the consultancy is, it makes no difference.

i.e. if the consultancy isn't trying to cut your rate then it means the client is and "pocketing" the difference.

The question you need to ask yourself is what are your chances if you refuse whether the client or consultancy can find an alternative.

The way I do this is to calculate how long I would require to find a contract at a better rate and compare 6 months on a low rate with 2-3 months on a higher rate.

[eek]

Market rates in my skill set contracts haven't gone down by 40%.
10-15% at the most.

And are the number of contracts available the same? Are all your fellow contractors working

You may nit pick all you like it but someone has said the new market rate for your skills is 60% of what it was earlier this year. We don't know that market and I actually don't think you do.

Hint in my field rates are down yet everyone I know has more work than they can cope with

[CountryGirl]

Yeah doesn't matter though. They are purchasing labour at market rates.

If they were buying bricks and the price of bricks went down 50% but their customers were still buying bricks from them at same price do you think they'd go to their brick suppliers and say "no please charge us more we are happy paying the price from last year"

Market rates in my skill set contracts haven't gone down by 40%.
10-15% at the most.

[eek]

This was my suspicion also.
But how can I find out?

You can't unless the consultancy confirms it - but being blunt does it matter - do you want money coming in or can you sit on the bench with an evaporating skill set for longer as I suspect we are under lock down now until next year.

[CountryGirl]

It's important to understand whether it is the consultancy or agency who is cutting he rate.
This may well be an agent looking to increase margins.

This was my suspicion also.
But how can I find out?

[fidot]

It's important to understand whether it is the consultancy or agency who is cutting he rate.
This may well be an agent looking to increase margins.