Why Aren’t You Making More Money?
Let's face it. Most of us would like to be paid more.
The truth is in my career, I've both felt guilty that I was being paid too much money compared to what I was really worth, and I've also felt that I could and should be making a lot more money.
The problem is, most of us don't really have a good understanding of how our services are priced out and what the true market value of what we have to offer is.
Understanding market value
The market value of a product or service is exactly what someone is willing to pay for it.
For a software developer, it may seem that your market value is what someone is willing to pay for you to write code or develop software– this couldn't be further from the truth.
Even though one of the main aspects of your job may be to write code, it is not what you are really being paid for.
Obviously, most software developers do more than just write code. But, the true market value of a software developer goes even deeper than those other responsibilities. The true value of a software developer is tied in with the perceived worth of that developer.
Yes, this sounds strange, but what this actually means is that what someone thinks you are worth, or rather the highest amount that someone thinks you are worth and is willing to pay you, is what you are worth.
Your skills, your history, how many lines of bug-free code you can write in an hour, don't necessarily matter as much as the perception of the value of your skills and abilities.
Consider the stock market. There are plenty of stocks out there that have a very high perceived value. Many of these stocks don't even pay dividends– essentially, they give no return on the investment to the purchaser. Everything about the value of those non-dividend-paying stocks is based on the perceived value of the stock, not on the actual utility of the stock itself.
I'm not saying that you should try and represent something you’re not in order to inflate your stock price. What I am saying is that if you want to be able to make a higher wage you've got to understand how the market works and how you are valued and priced in the market.
Increasing market value
What then drives this market value and how can we increase it?
Taking a look back at the stock market, we can get a pretty good idea.
Consider what drives the value of an individual stock. Here are a few important factors which can drive the price of a stock:
- What that company or stock has done in the past
- What that company or stock is expected to do in the future
- How many other people are buying or want to buy into that company
Sure, technical considerations like earnings per share and profit to earnings ratios are taken into account by many technical investors, but in reality what really drives the price of a stock is greed and fear based on past performance, expected future performance and peer pressure.
It is no different in the field of software development. A majority of your market value will be driven by what you have done in the past, what you are expected to do in the future, and how desirable you are to others.
If you want to increase your market value, you need to be able to increase one or more of these factors.
Most software developers try to focus just on increasing the perception of what they have done in that past. This is the reason why you often see overly lengthy resumes which detail out a long history or previous assignments.
Unless you have something truly impressive in your years of previous work history, it isn't going to amount for much other than showing some amount of stability.
Stability will get you a good job with a decent salary, but if you really want to reach the peak of your potentials earnings, you have do do more than show stability– you need to show trajectory.
To truly increase your market value, you want to be seen as a developer who has progressively done greater and greater things in the past and is likely to continue that trend into the future. You also need to show that there is a high demand for you personally, because of the unique offering of skills that you possess.
Great, but, how do I do… that?
Well, the first place you start is by taking an honest assessment of the picture you are currently portraying.
If you were hiring a software developer and you came across your own resume and presence, or lack of presence on the web, what would you think?
Would there be enough evidence to show a clear trajectory in the future?
Would you feel as though you had better not let this one get away?
Starting here, you can get a picture of what kind of package you are offering. If you can honestly assess where you are right now and how you are being perceived, then you will have a reference point which you can use to determine where you need to go.
After you have taken an honest look at yourself, it is time to take a look at other software developers and professionals who are already presenting the kind of image that you would like to present.
Look for the most successful software developers that you know would be able to command high salaries and try to imagine what makes up that “value” they represent. Now compare your efforts to theirs. What are they doing differently? How are they representing themselves to the world that makes it seem like they have more value? What things are they doing which are generating demand for them and their skills?
You'll probably find there are some quick changes you can make right away which can help greatly increase your perceived value. But, you'll also probably find that you will need to specifically chart out a course for increasing your value over time.
If you are still a bit puzzled about how to do this, don't worry, you aren't alone.
I've spoken with many software developers who want to get better jobs or advance in their careers, who know they need to learn how to market themselves in order to do it, but don't know how.
I'm actually working on a complete package to solve this problem. It isn't available yet, but you can pre-order it here, if you want to get it at the lowest price possible or you can sign up here to get updates about the course and find out when it officially launches as well as get articles like this one delivered right to your inbox.