Making Money in the asset integrity industry

Let’s start

I’ve been thinking. It’s just possible that some of you are interested in a job in the asset integrity business not only to save the world from failures and explosions but also as a way to keep food on the table and the wolf from the door; as a good little lifetime earner. You haven’t made a bad choice; it’s a good industry to be in for that. It was inevitable sooner or later then, in the Matthews integrity Hub: HEAD OFFICE website that this would happen; we are going to have to get around to the delicate issue of Money.

Let’s make a gentle approach to this; there’s no point in getting too excited. In this article we’ll introduce you to a few ideas relating to money and how you get it. We’ll think about your comfort zone, your safety net and your margin of difference. Then we’ll introduce to you the new concepts of turning points and purple patches. Finally we’ll look at an important decision for you, your choice between finding life and chasing the money-dragon. Stick with me on this journey.

Your financial comfort zone

We think a lot about comfort, do we not? It’s good to have a job that puts you in a nice position when it comes to buying the things you need, like food, a house and a car, and maybe a holiday or two in Benidorm or Gstaad. When your grandparents were working, this was quite not so easy for them; compare the cost of food and household essentials to the average weekly wage of then and you will see. Fast forward to the present however and in general the salary you get for most jobs will reward you with a reasonable degree of comfort.

The problem with comfort zones is that they have the annoying little habit of moving about. Immediately you become established in the financial comfort zone particular to you, then the boundaries expand, leaving you once again, not in it. The more this happens, the larger and fuzzier the boundaries become as, without realising it, you start to confuse needs with wants. This is dangerous ground; because whereas comfort needs are reasonably finite, wants are most certainly not. Wants will go on expanding for ever, holding you in their grip. Keep reading….to this subject, we will return.

You need a safety net

I reckon most of you will have already got this idea; it’s not exactly a new concept. To reduce the chances that unforeseen events that happen to you will ruin your life, you need to have a safety net, in hard filthy cash, to help you get through such situations. If you are a  reasonably frugal sort, then a safety net of about one year’s salary, tax paid, will see you through 90% of life’s little emergencies. If you are more the type of person that confuses needs with wants, then 2-4 years’ worth is a more reasonable figure. Pensions are a type of longer-term safety net, but we’ll leave them out of the discussion for the moment.

Here’s the problem. Even in the plant integrity industry, which is reasonably well paid, most full time salaried jobs, even at the higher level, will almost never enable you to build the type of safety net you’d like. As your salary increases, then so do your expectations of your needs. No-one really knows quite why; there’s probably some law of economics that dooms them to forever remain in balance. There is one thing that can help you mitigate its effects however; it’s known as your margin of difference.

Your margin of difference (your MODIF)

It wouldn’t actually be incorrect to rename it your margin of INdifference but it would make a less inspiring acronym, and we have to keep HR department on your side. MODIF has a definition:

Your MODIF is:

‘The additional amount of hard-earned, tax-paid cash that you need to receive per week in order to make such a difference to your life that you feel permanently happy’

Note the requirement for this happiness to be permanent. Temporary feelings of elation don’t count. It’s interesting to sit down and ask yourself just what this amount would be, and what sort of salary increase you would need to get it, and exactly how realistic that would be from a full time salaried job. Here’s an example.

Let’s say you earned £40k last year (not quite in the high-rate tax bracket but a good enough take at about 130% of the annual UK salary).After income tax and various other deductions that gives you a net pay of about £2300 per month, or £560 per week. What if you got another £100 on top of this? I’m suggesting to you that it won’t make much difference. One tank of petrol and a meal out and its gone. How about £200? If that will make you permanently happy (the MODIF rules remember) then please send us the formula. I’d start to believe you if you said £300 more; that’s the weekly shopping and travel taken care of and £50 left for ‘extra happiness’ pocket money. It’s a nice increase, but no Lamborghini yet, they start from £150,000, equivalent to a sobering 500 weeks or 10-years’ worth of your weekly increase.

If that’s all right with you then, congratulations, your very own personal MODIF is ….£300 per week. Feel free to amend this if you think we’ve got your figure wrong; we won’t think less of you.

Now comes the reckoning. Your MODIF increase of £300 per week means you have to receive £560+300=£860 per week net. Gross this up for tax and NI and you need a gross salary of about £65k per year to gain your MODIF increase. Do the maths and that’s a 62% increase in what you get at the moment. ‘I need a sixty-two per cent increase please boss.’

So what?

Before we consider the practicality of you actually getting such an increase or start throwing alternative numbers around, lets reflect for a moment what we have just concluded. We have concluded that if you find a new job in which any pays any increase less than your MODIF; it will make no difference to you at all, because it hasn’t changed, permanently, your state of happiness. The lower increase would simply lie within your margin of indifference, and within a week or two, it will be as if the whole thing never happened. That’s why your MODIF is so important. Now you know what yours is, we can move on. Let’s look at the idea of turning points.

Career Turning Points

Not so long ago, all jobs were permanent. This was as true in the integrity industry as any other. Now it operates mainly as a loosely-connected network of freelance and contract workers. Read our articles Integrity job roles; what’s new and The Gig economy; the employer’s view for details.

This step change in the way the industry runs has produced new opportunities for peoples’ careers within it. Rather than a 40-year procession from training to retirement, with little deviation along the way, the whole thing is now full of career turning points, where you can change your employer, employment status, gently redirect your career, or fundamentally change it without coming up against the wall of ‘the system’ trying to discourage you. This is good news. The fluidity and anarchy of the system is now in your favour, providing you with opportunities to be taken. This brings us neatly on to ….purple patches.

Purple patches

Now we’ve got a special word for them, what are they? They are the patches of highest paid work that come your way from time to time during an integrity industry career. You can easily spot them; they’re temporary, lasting perhaps six to eighteen months, and will later encourage you to recount them with the f

eeling of ‘I wish I’d done that earlier’. Purple patches are such good news that it makes sense to look at where you can find them, so you can go and look for a few more. After a bit of thinking we drifted to the conclusions that, in the plant integrity industry, purple patches are only really found in three places;

• Contract/freelance work

Permanent staff positions will only provide you with a purple patch if you have a particularly low MODIF, in which case, why would you be reading this article? For purple money, you need contract/freelance work, preferably on a day-rate.

• Multi-skill input roles

In talking to the people who had obtained the highest contract day-rates it emerged that just about all of them were for roles where they successfully provided multi-skills input rather than a single narrow skill. There are various possible skill combinations around but the model is a simple one. If you were an employer with the choice of paying one person £500 per day to ,say, perform NDT duties and another person £600 per day to hang around and assess the results and do the integrity report OR pay a single person £800 per day to do both, then which one would you choose? That is the advantage of, as a contractor, spreading the base of your technical ability.

• Unpopular locations

Asset integrity projects seem to like being in remote parts of the world; it’s probably something to do with globalisation and the expansion of the world economy or whatever. To many people there may be something romantic and frontier-breaking about locations in Sakhalin Island, the Nigerian delta or the tar sands of Canada (if you really like cold, grim and soggy, try St Johns, Newfoundland). That’s fine; they’re full of good people, but Knightsbridge, the Cotswolds, or Martha’s Vineyard they are definitely not. Hence the much higher contract day-rates than for working on your own doorstep. Overland pipeline project locations seem to be especially made for purple-patch money; they start and end in unpopular locations and pass through lots of others on the way. Pipelines should all be painted purple.

Hopefully you can see how this plan is progressing; in order to find a job that pays your MODIF, what you have to do is utilise your nearest turning-point to get into a purple patch. Once the patch ends, then do the same thing again, and keep on doing it. Before very long, Voila! There’s your safety net.

A word of caution; Chasing the Money Dragon

The problem with dragons (they are real by the way) is that they, well, act like dragons. Shiny, scaly and with impressive teeth, they look good and would impress or frighten your friends if you walked down the street with one. The question is, would you really want one for a pet? The unexpected fire-breathing could cause a bit of a problem and you’d never be 100% sure whether it was going to turn on you or not.

True to form, the money-dragon exhibits all of these qualities, and a few more. Talk to people from any organisation (about 10-15 people will do) for a week or two and you will soon hear the rumblings of unhappy people. There are basically two types; the moaners and naysayers, and those who quietly keep it to themselves. This last group can be found still sitting in their cars as the clock ticks towards 9 o’ clock. You won’t have any problem identifying the first bunch.

So, you could ask yourself, if they don’t like it, why are they still working there? Again there are two categories, those that are unhappy about money and still stay there (what we are talking about) and those that are unhappy about other things but don’t move. Of those that fit into the money category, most of these seem to be peeved about one, or more, of three things:

• Annual salary increases (meaning the size, or lack, of them)
• Expenses (mainly travel/accommodation-related)
• Pay differentials (between them and somebody else)

Unusually, peoples’ consolidated annual salary doesn’t rank as high on the unhappiness agenda as you might think; it seems to be these three peripheral issues that take priority. Now for a stranger thing, if you were to correct whichever of the three issues was causing someone’s main unhappiness (one always takes priority), then the overall benefit to that employee would almost always be less than their MODIF. This means that their unhappiness, financially at least, is unfounded. The reason that they are unhappy is not that they don’t have enough money, but that they are chasing the money-dragon. Someone needs to tell them; don’t bother chasing it. No-one ever catches the money dragon; it can run faster than us all.

Finding life

There’s an alternative to dragon-chasing. It’s called making satisfying use of whatever talents you have. As an employer you can design your employees’ jobs around this idea and as employee you can design your life around it. As an alternative policy it works well; life is about interest, so don’t waste it chasing financial upgrades that won’t even meet your MODIF.

Message to all employees

The point we’re trying to make here is that in the current incarnation of the plant integrity industry, there are opportunities there for all. Turning points and purple patches are around in profusion, just waiting for you to take them. If you are convinced that your employment status is what is holding you back, then check out our article on Job status and money in the integrity industry. It’s always good to remember that your money-earning capability is always in your own hands, not that of your boss. Don’t mess with the money-dragon though.

Message to all bosses

There’s no need to worry about your employees reading this article. You should feel good about it, because it all applies to you too.

Thank you

Thank you for reading this part of Matthews HEAD OFFICE: MoneyBIT. We are sorry if you were looking for the results of some integrity industry salary survey with which to hit your boss between the eyes. You can find these surveys on the internet in two minutes if that’s what you want.

This article is the work of THE MANAGER. We welcome his contributions to Matthews Integrity Hub: HEAD OFFICE