Self-employed, freelancers and startups
How to calculate your fee with IDA's salary tools
Self-employed people can easily use IDA's salary tools, but they need to be used with some care. The main reason is that the statistical basis for self-employed data is affected by the fact that the group of self-employed is much smaller than the group of salaried employees in IDA's salary statistics.
Differences in earnings, for example, among the self-employed are also much larger than among salaried employees. Moreover, the response rate for the self-employed is around 27%, which is 10% lower than for salaried employees.
Every year in September, DA asks members to share their salary data. In 2023, 897 self-employed people submitted data to IDA's Salary Statistics - this corresponds to a response rate of 27 per cent.
Used correctly, salary data for employees can be a great help when, for example, as a self-employed person you need to estimate your hourly rate or assess whether you are getting enough out of your efforts.
You can use IDA's various tools to get an idea of what a realistic hourly rate is for you and your business.
How to use IDA's tools
Get an overview with Salary Statistics 2023
You can find out about income and fees for the self-employed in IDA Salary Statistics 2023, for example how fees are distributed by sector, company size and number of employees. Note that the figures refer to the calendar year 2022 as opposed to employees, where the figures are based on the September 2023 salary.
You also get a good overview of what is earned in private companies or the public sector.
See hourly rates for the self-employed in IDA's Salary Statistics (pages 39-43).
How to estimate your hourly rate
As a self-employed person, you may need to estimate how high your hourly rate should be.
A useful method is to start from what an employee with the same profile earns and then estimate your other costs of being self-employed.
1. Use the IDA salary calculator as a starting point
Use IDA's Salary Calculator as a starting point - here you can see what a profile similar to yourself earns while taking into account a number of parameters, e.g. seniority, sector, responsibilities, management responsibilities, etc.
In the IDA salary calculator, you can see both the average salary and how salaries are distributed. You can also see how many have various "other benefits", such as free phone, lunch, PC, etc.
For example, you can see what a civil engineer with 20 years' experience working as a project manager in the energy sector in North Jutland earns.
2. Company salary statistics
The next step is to use IDA's company salary statistics to compare salary levels in a wide range of companies. There is an index for companies where more than 5 IDA members have submitted salary information.
This can give you a sense of how salaries vary in companies doing the same thing as you.
Use the IDA Company Statistics
3. Guide to employment terms - because salary is more than money
In IDA's Guide to Employment Terms, you can compare a number of other employee benefits in the same companies, such as bonuses, extra holiday, working hours, overtime pay, skills development, etc.
Link to the Terms and Conditions Guide
4. Conversion from salary to fees
But you are not an employee - in addition to your own fee ("salary"), as a self-employed person you have a number of costs such as rent, marketing, skills development, holidays, pension and insurance. You also need to estimate how many hours you can bill on average.
The rough estimate is to take the monthly salary of a relevant employee in the salary statistics/salary calculator and divide it by 160.33. Then you have the hourly rate you can multiply by 2.5.
But it is a good idea to calculate the costs more precisely. Both to make sure there is enough left for yourself after costs. But also to make sure you are competing with other companies and possibly their own employees at the level you want.
Here you can use the IDA's Hourly Rate Calculator, which gives you a good estimate of the hourly rate you should charge based on your cost structure.
Read more and use the IDA Fee Calculator (In Danish)
Contact
Of course, you are always welcome to contact one of IDA's advisers if you have any questions or need advice.