Point of View
June 1, 2006
From my perspective as a longtime land surveyor and business owner, I fear that the future of land surveying will be in danger if our profession cannot attract the best and brightest to fill our aging ranks.
It is becoming increasingly difficult to find young students who are interested in becoming registered or licensed land surveyors. It is my belief that our struggles with recruitment and retention are tied to our struggle to make a profit. If we learn to make a fair profit, we can offer salaries that will entice young surveyors to work for us.
Business CostsTo start our discussion of how to make a profit-and therefore how to attract quality employees-we must first consider the many costs involved in running a surveying business. These costs include (but are not limited to) vehicles, safety and crew signs, business signs, survey gear, and equipment and instrumentation. Office space includes rent, computers and printers, a plotter, copiers, scanners, furniture, phones, radios, etc. Daily soft costs include office and field supplies, monuments, postage, letterhead, business cards, brochures, reference books, professional associations dues, and subscriptions to magazines and periodicals.
Payroll is one of the larger cost factors in business. Some of the payroll costs to consider include both state and federal taxes and a multitude of insurance coverages for equipment and professional liability (including workers' compensation, dental, health, disability, personal paid time off and holidays).
With all of these costs to consider, how can a business owner make a fair profit? What is a fair profit? Some businesses believe that a profit of 5, 10 or even 20 percent is not necessarily a bad thing-but there are other costs to consider. At the closing of a fiscal year, the IRS requires a professional corporation to be responsible for 35 percent of the first dollar profit in federal tax. In California, for example, the state minimum tax is $800, even if a company doesn't make a profit. Owners must take all of these costs into consideration if they want to make a profit.
Salary ComparisonsIn addition to overhead, payroll and taxes, business owners must also consider employee salaries in their estimation of business costs. How can owners find exceptional employees and retain them? First they must offer good salaries, good benefits packages and exceptional working conditions as well as an exceptional work environment. Consider the salaries offered in other industries to see what you are up against for attracting employees into surveying and geomatics. For example, according to the Occupation Employment Statistics survey for the state of California, computer software engineers have an average annual wage of $89,332. Police officers average around $63,796 annually, while electricians make around $50,502 annually. An attorney makes a conservative average of $60,000 annually, which is the same as a forensic science technician. A truck driver averages around $37,560 annually while a special education teacher can bring in $59,500 annually. A graduate with a master's degree in business will want $90,000 annually to start, while graduates with a bachelor of science degree in geomatics from Fresno State University start at around $50,000 annually.
Rate CalculationA current employment solicitation for a land surveyor in San Diego offers $28-$36 per hour while another ad offers $25-$35 per hour for an experienced party chief. How will the owners pay these salaries? And how do they calculate rates to cover costs?
Here is one way I learned. First, find the production hours per year needed to be billed to recover costs. Start with 2,080 hours and subtract holidays (80 hours) and required breaks (78 hours), then sick and vacation time (120 hours). Then budget for training, both in-house and offsite (around 40 hours) and staff meetings to keep your team on track (26 hours). What you are left with for production is a conservative estimate of 1,736 hours. My certified public accountant (CPA) taught me to divide a given salary by 1,736 hours and multiply by three to get a billing rate.
With this information, put together a mock crew. Two police officers would require a rate of $220 per hour, while two electricians would require a rate of $175 per hour. Two truck drivers would have to bill at $130 per hour and two teachers would need to bill at $206 per hour using this equation. Two forensic science technicians or two attorneys would need to bill at $207 per hour. According to the employment ads I've seen, at the lowest starting wage for a land surveyor, hourly rates would be $200 per hour for a crew of two. At the highest salary offered in the ads, the rates would be $259 per hour for a crew of two.
Some other things to consider while determining your scheduled rates are the philosophies of other professions. Attorneys have a philosophy on rates: no one wants to be the lowest. This is due to the fact that they are selling knowledge; the more knowledge you have, the higher the price should be. Their clients believe that knowledge is important and they will pay more if they want to win their cases. Realtors charge 1.5 to 10 percent of the gross sale; if we were to charge 1 percent, we would make more than we do now.
Surveyors need to keep in mind the services they are selling. We are selling knowledge, historical records and experience. All of these are valuable and can save a client a lot more than a lawsuit would cost. So why do surveyors charge so little? Why don't they believe in themselves? Why don't they believe that the information they provide is valuable and important? If you are in business and you want to stay in business, you must consider these questions seriously.
Finding and Retaining StaffAlso consider your staff seriously. Pay them excellent salaries and benefits. As a profession, surveyors should be looking to attract young surveyors who are interested in making $90,000 initially and up to $150,000 annually. If surveyors truly believe in the information they provide, then they should be looking for employees that have education and experience to support these services. Land surveyors must have many of the same qualifications as the other professions I've mentioned. A surveyor is required to have strong math skills, managerial skills, forensic research capacity, certain legal expertise and much more. To attract such qualified employees, owners need to pay them more money. If it is understood that salaries need to be raised, then it should also be understood that rates need to be raised. Surveyors cannot afford not to raise rates. Following these recommendations, surveyors can deliver a quality product and maintain integrity while charging their clients enough to cover all of the business's expenses and make a profit. This, in turn, will allow our profession to thrive because we will be able to afford the talented young professionals necessary to carry surveying forward in the future.
Sara Thurner, assistant operations manager at Ray Carlson & Assoc., assisted in drafting and fact-checking this article.