Female self-employed people are doing themselves a serious disservice. Their hourly rate is on average lower than that of their male colleagues with the same education and experience. The difference is up to 16 percent.
The differences are particularly large among higher educated people, according to research by online bank Knab among 10,000 self-employed people. The hourly rate of women with a college or university education is on average 13 percent lower than the hourly rate of their male colleagues who do the same work and have comparable education and experience.
Yet men and women are equally satisfied with the hourly rate they earn, says Casper Zwart, who conducted the research. “In both groups, 65 percent are happy with their hourly rate. This may mean that female self-employed people are not aware of this gap.”
Better negotiation
One explanation for the difference in hourly rates is the ability to negotiate the rate. Men are generally better at this, they think. 40 percent of women think they negotiate well, compared to almost 60 percent of men. “The rates of men and women who say they negotiate very well are virtually the same,” Zwart sees.
The ICT sector is a positive exception. In this sector, women charge approximately the same rates as men. “This may be explained by the fact that there is a large shortage of women in that sector. 90 percent of the ICT self-employed people in the study are men,” says Zwart
Insight into rates
Knab has not only looked at the differences between men and women. The aim of the research was to gain insight into the rates that self-employed people charge in the various sectors. Self-employed people in government, business services and IT charge the highest rates. The average rates there are around 100 euros per hour. The lowest rates are paid in the catering industry, with an average of 49 euros per hour.
The research shows that self-employed people generate an average turnover of around €100,000 per year. But here too the differences are large. In government, business services and ICT, the average annual turnover is between 120,000 and 140,000 euros. A self-employed person who works in the sports and recreation sector earns on average just over 50,000 per year.
“These turnovers are gross income. This excludes all business costs – such as materials, insurance and pension premiums – and of course income tax,” Zwart qualifies the earnings.
‘Be more likely to say ‘no’ to an assignment’
Financial expert Adine Faber-Versluis’s mission is to ‘help a million women become financially free’, as she puts it. She runs the website Money Mind Academy, which helps women with financial matters. She gives 5 tips that can help female self-employed people earn at least as much as their male peers.
1. Don’t be too quick to settle for what is offered
“If women have to make agreements with their client about their remuneration, they are more likely to settle for what they are offered compared to men. I think women find it more important to be liked. Yes, that is partly due to women, but certainly also to companies that offer women less as standard. Women can be a bit tougher: they can say that they are sure that men earn more, and can also say that this is discriminatory, in an extreme case.
2. Be open about what you earn
“This applies to almost all freelancers: because openness about what you earn can help everyone. It is important that self-employed people are aware of the differences, because only then do you know that there is room to negotiate. Women can then compare themselves with men. There are many Facebook groups where that information is shared. And there are also many trade associations and network meetings.
3. Women should rely on their self-esteem
“When a woman receives an offer, she thinks more quickly: ‘I can make it with that.’ But the question should rather be whether the company pays what a woman is worth. And speaking of self-esteem: you simply don’t do the assignment if you don’t get the right amount. I think women find that a bit more exciting. Because what if a company actually says that they don’t think you are worth a certain amount? That is personal, that is how the brain works. Women find that more exciting to do. Because you actually don’t have to take it personally at all.”
4. Also run assignments
“If there is no match between you and a client, especially financially, you can safely let a job go. It is also take it or leave it. Every time you take a poorly paid job, it deprives you of the opportunity to work for a higher rate.”
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