Freelancing in Data Science
Freelance Data Scientist Thomas Wood. Helping organisations extract value from unstructured data.
Freelance data scientist hourly rate
How much is a freelance data scientist’s hourly rate? There is no simple answer and it doesn’t make much sense to talk about average rates. The main factors determining a freelance data scientist’s hourly rate are location, speciality and experience level, not to mention the data scientist’s business acumen and negotiation skills.
It can be hard to find out exactly what hourly rate a freelance data scientist can charge because freelance work is not always advertised and when it is, the rate is usually negotiable.
How do qualifications and experience level affect a freelance data scientist’s hourly rate?
A freelance data scientist’s hourly rate varies according to where they lie on the scale from novice to expert consultant
Let’s imagine a number of scenarios. I am quoting some typical figures for UK- or US-based freelance data scientist hourly rates but the numbers would vary by location.
Novice freelance data scientist hourly rate
A novice freelance data scientist who is fresh out of university can probably use online marketplaces such as Upwork to apply for small freelance data science gigs, and will be competing with people of similar experience levels worldwide. The competition will include people in low-income countries and people who have learnt data science on a bootcamp course rather than a degree programme, and the clients may not always know how to distinguish qualified freelancers from unqualified, so there will be a race to the bottom on novice freelance data scientist hourly rates. You can read my post on how to become a freelance data scientist for more information about joining Upwork and other marketplaces, and what to expect.
My Upwork profile. You can put an hourly rate on your Upwork profile.
Hourly rates are advertised on Upwork and most likely the novice freelance data scientist can charge an hourly rate of $50. Most of the gigs they take on will be relatively low-level, perhaps mundane tasks in Python rather than cutting-edge machine learning, and this is reflected in an inexperienced freelance data scientist’s hourly rate. However there do exist some highly-paid expert jobs, mainly under the “UK only” or “US only” filter, which will pay a market rate better suited to your location.
Freelance data scientist hourly rates averaged around $80/hour for contracts in Natural Language Processing on Upwork in 2020. There were a few very highly-paid outliers, but the majority of Upwork contracts which I could find were in the <$50/hour range.
Moderately experienced freelance data scientist hourly rate
A freelance data scientist with a moderate amount of experience can charge a slightly higher hourly rate. Imagine a freelance data scientist with a Masters or PhD and a few years of experience working in small but unknown companies.
A moderately experienced freelance data scientist can use their connections and network on LinkedIn to find more challenging work. Perhaps they will have a degree of experience in a particular industry and they can leverage that. A moderately experienced freelance data scientist could charge an hourly rate of about $100.
I have found a few interesting freelance jobs simply from in-person and online networking. For example, a university alumnus might recommend a colleague who has an interesting problem in NLP and which might be right up my street. These kinds of leads can be very valuable when they come in.
Contractor freelance data scientist hourly rate
A freelance data scientist with a decade or more of experience can charge much higher hourly rates. Let us imagine a freelance data scientist who has been working in machine learning since before the term “data science” was widely used. This person has worked across a range of industries. This freelance data scientist prefers to work in comfortable long term contracts for a single client, alongside the client’s permanent employees. The rates for contracting are good and a contractor freelance data scientist can charge hourly rates up to $200.
In the UK it’s possible to get some feel for what hourly rates a freelance data scientist can charge, simply by looking at the advertised rates for contractor roles.
I’ve taken a sample of 54 data science contract positions in natural language processing which were advertised in London in 2018-2020 on a variety of marketplaces. I have taken the daily or hourly rates which were either advertised or stated by the recruiter when I spoke on the phone. You can see that there is a lot of variation but the contracted hourly rates averaged around $115/hour. In general, freelance data science contracts in natural language processing or computer vision tended to pay higher hourly rates than contracts in general data science, and the hourly rates are also higher than the rates for employment.
It should be noted that I avoided startups and small companies when choosing the advertised contract roles, so these are generally the higher paying roles on the UK market.
Freelance data scientist hourly rates averaged around $115/hour for contracts in Natural Language Processing in London in 2018-2020, however there was a lot of variation.
Expert consultant freelance data scientist hourly rate
Finally, there are the consultants. A consultant data scientist does not apply for jobs or gigs on any kind of marketplace, but rather uses networking and even direct sales pitches. This person operates effectively as a small company and may compete against small and medium-sized consultancies, and this is reflected in the consultant freelance data scientist’s rates.
The consultant may have two decades of experience, will have written a series of books and may be an in-demand speaker or lecturer. A consultant will help companies with their long term data strategy, rather than simply complete a pre-defined task. Large companies know to look for the consultant for difficult problems.
An expert consultant freelance data scientist does not have an explicit hourly rate, but charges clients on a per-project basis. They may waive fees if a project does not deliver the expected result. The sales process may involve a series of presentations and unpaid proof-of-concepts, and the consultant may enlist a sales representative to help with sales. Working from the fixed price charged to clients, the expert consultant freelance data scientist has an effective hourly rate of $500 and up.
How does a freelance data scientist’s hourly rate vary by location?
Location is a very important factor in determining a freelance data scientist’s hourly rate. In general, the USA, especially the West Coast, has the highest demand and highest rates. The geographical variation in data scientist salaries and rates is dampened slightly by the fact that a lot of work can be done remotely, however the rates still vary hugely between locations.
I was unable to obtain comprehensive data on freelance data scientists’ hourly rates between countries, so as a proxy I have used permanent data scientists’ reported salaries to estimate the geographical variation in four countries.
We can see that North America has higher rates than Europe across the board. Within countries there is also considerable variation, with cities paying considerably more. In addition, the wealth of a country is not necessarily a predictor of the hourly rate. Data science is a very important field in the USA, but less so than in, for example, France, which is a much more conservative country when it comes to technology.
I suspect also that larger countries such as the USA, UK and Germany tend to have more demand for data scientists than wealthy smaller countries, because companies in large countries have huge customer bases and larger datasets to work with. Within Europe I have definitely found a divide between north and south, with the UK, Germany, the Netherlands and Scandinavia having very highly paid freelance and permanent data science jobs on offer, while southern European countries such as Spain and Italy do not have such a high demand for data science services and consequently pay much lower freelance data science hourly rates.
Estimated data scientist hourly rates in four countries. Data from payscale.com.
How does a freelance data scientist’s hourly rate vary by speciality?
In recent years, demand has grown for data science specialists who can work with more generalist data scientists and analysts. For example, experts in natural language processing, computer vision, and deep learning libraries are in high demand, and can consequently charge hourly rates much higher than a data scientist who works with the basic toolkit in Scikit-Learn. I would venture to say that freelance data scientists in these niche areas could charge double the hourly rates of their generalist counterparts, although I do not currently have data to back this up.
There are many factors affecting a freelance data scientist’s hourly rate.
First of all, the data scientist’s location is an important factor, with many companies in the US preferring to hire US-based freelancers, even if the work is completely remote.
Secondly, freelancers with an in-demand speciality such as natural language processing can increase their hourly rates accordingly, as they do not need to compete with so many people.
Thirdly, the freelance data scientist must know how to negotiate rates, and find clients directly. If the freelancer uses marketplaces such as Upwork, the competition will force a race to the bottom on cost, and the freelancer will wish to avoid this.