An Hourly Fee for Translation?

Before dismissing the idea of charging an hourly rate, it’s important to examine a few underlying assumptions associated with this practice.

Freelance language services in the U.S. have traditionally been priced in two ways: translators charge out for their work per word, while interpreters charge out per hour or per day.

In recent years, however, businesses, agencies, and even a few translators, have begun discussing the possibility of translation services being paid by the hour as well. At a recent ATA Annual Conference, one speaker rhetorically asked why translators can’t be paid by the hour, like lawyers. The audience grumbled in response.

Hourly pay has been rebuffed by translators who assume that it will result in less income than they might earn per word, especially if they are good at their jobs. They believe that their speed and proficiency will work against them. And indeed, their fears are justified, unless both productivity and total cost can be taken into account.

The traditional per-word (or line, or even page) pricing model is based on the idea that the more words there are to translate, the longer it takes to complete a job. Words are proxies for the translator’s time. This concept is fairly easy to understand. Given two similar documents, translating 500 words takes considerably less time than translating 5,000 words. Therefore, with per-word pricing, the total cost of these two jobs will differ by a factor of 10.

The pricing calculation is less straightforward when hourly pay is added to the mix. While it’s clear that it takes longer to translate 5,000 words than to translate 500 words, the exact number of hours is often difficult to estimate ex-ante. Though, undoubtedly, it differs from one translator to the next, in light of their relative familiarity with the subject matter, their educational background, and their experience, among other factors.

Hence, we arrive at an hourly pay paradox. All things being equal, an experienced translator will require less time to complete a job than an inexperienced one, resulting in fewer billable hours for the more experienced translator, and thus, less income. This is simple math. However, before dismissing hourly pay out of hand, it’s important to examine a few of its underlying assumptions to determine what else is going on here.

The first, and most significant assumption, is that all translation—and all translators—are equal. In other words, translation services are a commodity. This claim is based on the (fallacious) belief that it doesn’t matter who translates a file. Words are words, according to those who subscribe to this theory, and the final product will be the same, regardless of the translator.

At this point, you’re probably either laughing or angry (or both). Because, of course, anyone who works in language services knows that this statement is patently untrue. The final product depends on the translator’s background, experience, and above all, writing skills. There’s a reason why everyone isn’t a famous novelist, journalist, or essayist. Despite the fact that we all know how to write, our skill levels differ. The same thing applies to translation. Some translations are better than others, because some translators are better at what they do.

The second assumption is that translation services—and by extension, translators—can be compensated at a single hourly rate. This premise depends on the first assumption being true; that is, that all translators are equal. This misconception is commonly held by monolinguals, who have a tougher time assessing qualitative variations across languages. Yet, even among language service providers, varying quality is often marketed as non-existent, it having been attenuated by proofreading and editing.

Of course, all translators know that translation quality varies from one professional to the next. Consequently, compensation for translation services must reflect these qualitative differences.

Under the current pricing model, some of these differences can be seen in per-word rates. New translators may earn half, or even a third, of what experienced translators can garner per word for their services. This makes economic sense: a new translator’s output is often going to take longer to produce, have more mistakes, and require more time editing and proofreading. In simple terms, it is going to be an inferior product. As a result, compensation is usually lower.

So, while a client may be willing to pay an experienced translator $0.15 a word for a finished product that requires little to no proofing or editing, they may only offer an inexperienced translator $0.05 a word for the same job, because it needs more work on the back end (and thus, has an additional cost).

As such, not only can an experienced translator charge more per word—given their experience and quality—but that same translator can produce more words a day, and thus earn more income overall. The upshot is little economic incentive to move away from this model.

This is how experienced translators view this issue, but what about final clients? From their perspective, whenever they request an estimate for a job, what they really want to know is how much the project will cost. As translators, over the years, we have taught clients that we determine our costs per word (line or page). However, this is just one way of valuing our work. In the end, money is money, regardless of the calculation used to come up with that final number. In general, a final client doesn’t care how the price is determined. It’s the total cost that matters.

Thus, if the market moves in the direction of an hourly fee, translators might be forced to rethink the way in which they quote jobs, focusing on total cost instead.

A theoretical example may help clarify this idea. Let’s say that a client has 1,000 words to be translated. Normally, translators quote a price based on their per-word fee. For simplicity’s sake, let’s use a hypothetical rate of $0.15 a word. With per-word pricing, the translator gives the client an estimate for this thousand-word job of $150. The client gets the quote, and if the deadline is feasible, the job gets approved based on this total cost.

If pricing shifts to an hourly fee, then productivity needs to be added to the mix. An experienced translator may think, “I can do this thousand-word job in about two hours”; whereas a less experienced translator may say, “This job is going to take me six hours.” In both cases, with per-word pricing, the client is going to be invoiced $150, but the first translator will earn $75 an hour, while the less experienced one makes $25 an hour.

Doing this calculation is a freelancer’s first step in determining whether an hourly fee is acceptable. As in the per-word model, the experienced translator will make three times as much as the inexperienced translator, reflecting differences in quality, knowledge, skills, etc. But hourly pricing still has other issues that need to be addressed.

For instance, this first thousand-word job may only take two hours to translate, but the next thousand-word job may take three hours to complete, because it involves more research or more formatting. Under the per-word model, the translator would only make $150 in both cases; but if the experienced translator has set an hourly fee at $75, then the new job would have a total cost of $225. When submitting this estimate to the client, the translator would need to be able to justify the extra cost by explaining the extra amount of time needed for research and/or formatting. In this case, having an hourly fee works in the translator’s favor.

From total cost to output per hour, it’s possible for translators to charge out hourly and still earn the same amount of total income as they made when charging per word. But they must be able to explain why fees vary among translators and between jobs. The explanation starts with productivity, which is a function of training, knowledge, experience, and skill.

Hourly pay for translation services is not inevitable. The per-word model seems to be working just fine. However, if the market does move in that direction, translators need to be prepared to justify and defend differentiated charges. They can do so by focusing on productivity and total cost.

Additional Information

ATA Antitrust Compliance Policy, http://bit.ly/ATA-antitrust-compliance-policy.

Jenner, Judy. “Should We Charge for Translation Services by the Hour?” The ATA Chronicle (September/October, 2015), 31, http://bit.ly/Jenner-Chronicle.


John M. Milan is an ATA-certified Portuguese>English translator, economist, and independent researcher with nearly 20 years of professional experience. He was a foreign language fellow at Ohio State University, where he earned an M.Sc. in applied microeconomics. He worked for 10 years in São Paulo, Brazil, as an adjunct professor of economics at Fundação Armando Alvares Penteado University, concomitantly freelancing as a translator, interpreter, researcher, and consultant. He is the president of the Carolina Association of Translators and Interpreters, an ATA chapter. He is also a member of ATA’s Finance and Audit Committee. Contact: john@milanlanguageservices.com.

3 Responses to "An Hourly Fee for Translation?"

  1. Ted Wozniak says:

    An interesting concept, but I would suggest taking it to the next logical step. Instead of determining an hourly fee, use your estimated productivity (words per hour) and desired hourly income to calculate a fee for the entire project. After all, with respect to cost, the client is only concerned with the total cost to them, not the hourly or word rate.

    I have begun moving to quoting on a “per project” basis, factoring in the time required for research, translation, post-editing and review. Even agency clients appreciate a “bottom line quote” as it makes it easy for them to determine their profit margin as they often (usually?) have quoted a flat fee to their end client.

  2. Eve Hecht says:

    Other than tradition, there are numerous advantages to the per-word rate. It is verifiable, and there is no temptation to “fudge” the total hours billed. Experienced translators can project their source/target word ratios and thus bill by either one if asked to do so. Per-word rates can be adjusted to account for extra research and formatting, for example.

    However, there is a larger issue. Lawyers, the professionals with whom we most frequently work, don’t hesitate to bill by the hour. And while rates of $1000 per hour may be only for deep-pocketed clients, no one thinks $200 an hour is too much. Yet if I were to quote a client $150 an hour – which is in fact what I frequently earn, based on my words per hour – that would be met with incredulity and “What!?!?! Never mind…”. Of course I can quote a per-project rate, but that begs the question.

    We will be respected as professionals only when we can charge the hourly rates we deserve for the highly skilled work we do. That time has not yet come, and I doubt I will see it in my lifetime.

  3. David McKay says:

    Even when giving an estimate for an entire project, I’ve usually found it necessary to use a word rate or an hourly rate rather than stating a flat fee for the project as a whole. That’s because the client’s initial estimate of the number of words and the other work involved is often far off the mark. If you agree to a flat fee for the project, then either the client has carte blanche to send you an unlimited amount of work related to that project, or, if you specify some maximum, then you have to renegotiate once that maximum is reached. At that point, there is often enormous pressure on the translator to get the extra work done quickly, before there is time to complete additional negotiations about the price. I’ve always avoided this situation by agreeing in advance with the client that the final invoice may deviate from the estimate and will actually be based on a word rate, an hourly rate, or a combination of the two.

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