Ask HN: If my company bills me out at $165/hr what should my salary be?
A fair salary is the one you shake hands on. It will largely be set by your value on the market and what you can successfully negotiate, not by your employer&#x27;s unit economics.<p>But let&#x27;s talk unit economics of consultancies, since they&#x27;re useful to know. Your employer will model you as being approximately 70% utilized for the year. Your gross revenue contribution is approximately $231,000. Your employer has approximately 20% overheads; that knocks it down to $185k. They&#x27;ll want to keep somewhere in the 15~20% of gross range as their profit; that leaves about $140k. This makes the math convenient, since the TCO of a technical employee is about 140% of base pay, which is going to come in right about $100k. [0]<p>&quot;$100k is a very different number than $231k.&quot;<p>Yep, it is. If you want to capture a substantial portion of the difference, put out your shingle and start getting gigs.<p>[0] This isn&#x27;t a guarantee, and if the company thinks that $80k gets you over the line, then they will probably offer $80k. If your other offers and irreplaceability to their ability to deliver gigs counsels $120k, they might accept being bid that high. But there are HNers who will suggest that you get e.g. $160k and that seems <i>highly unlikely</i> if the consultancy wants to stay in business long-term.