Day Rate Expectations

Engineering Marine Engineering
1

I’d like to get others opinions on day rates. One of our vessels requires DDE4000 or Unlimited as well as OICEW. We’re a small business and our day rates are hard to compete with Union / GOM expected rates, however, we offer decent benefits and employees get the same day rate whether pierside (most of the time) or offshore on operations.

While pierside, the crew works approximately an 8-hour day with 3 high quality meals provided. Although certain cases, (during mobilization and demobilization of jobs) the day may extend past the 8-hour day. My understanding is the “day-rate” is expected of a 12-hour work day, which many in this industry hate. But we have decreased our typical working day to 8-hours, yet have a difficult recruiting because all mariners are focused on is the “day-rate”. What they’re not taking into account is they’re working 1/3rd of the day less than industry norm, same day rate pierside as off shore (pierside +/- 85% of the time), paid day travel to and from vessel, paid travel expenses, the meals provided are high quality and we offer equal time on/off (which is flexible if wanted more time on).

I’ve had engineers literally laugh at $600/day for an assistant engineer, who if worked 6 months out of the year on a 6 week on/off rotation, is bringing home about 110k, while also not working themselves to death, having a good work/life balance and great work environment. Those that do come tend to stay and love it, and wish they found our program sooner.

How can we get around this hump in this industry besides simply raising our day rates? Do engineers really only care about the money and nothing else when finding a healthy work place?

2

Offer overtime if the day goes beyond 8 hours.

Do you allow crew to go home at night if they’re in port? You could consider having duty nights/weekends like they do in ROS where you get a stipend for being the mate/engineer with duty overnight while everyone goes home. This is how most ships keep their crew when they don’t leave the pier much and their day rates are low.

That is pretty low if you’re working 7 days a week with no other compensation.

3

Yes, We have crew members in San Diego who go home every night after the work day while in port.

4

Well that’s the thing, they’re comparing us to companies who pay $700/Day for a 12-hour work day, where here, it is 8 hours… That’s what I can’t wrap my head around. 1/3rd less work but 1/7th less pay.

5

In most cases money will always be the bottom line. Everyone’s situation is different though. I’m the sole provider for a family of four, so to keep up with everyone’s erroneous demands, highest day rate along with the least time away from home is at the top of my list. Benefits close second.

Now if my better half had a job making 50-70 k a year, maybe it wouldn’t be my bottom line.

You said that your employees are pierside a lot. I’d consider being flexible on my ‘day rate’ if i was living in a reasonable commuting distance for that job. However if you say this is in san diego, that’s just as expensive as anywhere else in southern california. 110k doesn’t get you much these days in so cal…but i’d revert to my original statement that if my better half was employed I’d consider it.

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6

If i’m flying or driving somewhere for a rotational job, working an 8 hr day or 12 hour day doesn’t matter. I’m stuck there, can’t go home. I need to make as much as I can to justify the headache and sacrifice being away from home. The only time I can see selling the 8 hr day as a big positive is if i lived within commuting distance and was home at night.

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7

Perhaps advertise on gCaptain job site & other places where mariners visit and mention the port you’re trying to crew up & the possibility of going home most nights. We’re in an industry with an aging workforce & some near retirees might be interested into slow steping into retirement. $600 bucks a day, home some nights, short rotations & even time would do it for me. About the top quality food. I don’t see that as a selling point especially if I going home at 5pm to eat with the fam. Folks going home or out on the town that night seldom eat on board.

This might be a long shot & maybe won’t work on Americans but I’ll say it anyways. 15 yrs ago I was working foreign shooting the breeze with the manager I had known for several years from other companies. He was complaining that the local hirees were jumping around to other companies & he couldn’t build a local, loyal workforce. I told him to send gifts home with the mariners exclusively for the wives, girlfriends & mothers. A few months later the company did it, sent gift certificates to a national chain of beauty salon stores or something like that. I don’t know if it helped the bottom line or not but he said he was bombarded with calls, letters & emails of thank you. Happy wife, happy life.

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8

Most of what a sailor gets paid for is being confined to a boat away from home. He is on the job 24/7. It doesn’t matter if he is standing watch 8 hours a day or 12 hours a day, he is still on the job away from home 24 hours a day.

Good food does make a big difference in attracting a retaining good crew, but it won’t offset a substandard date rate.

A harbor day boat job and being able to go home or go ashore at night does make a big difference in what is an adequate day rate, especially for local guys that live nearby.

However, most companies today must hire nationwide. The supply of local mariners is too limited in most places.

One problem that you have is that California is a high tax state, and the California Tax Franchise Board is a very aggressive tax collector.

I am reluctant to work for California based companies, or any company that is processing its payroll in California, even if I never set foot in California while on the boat. Payroll companies like ADP also sometimes create state tax problems.

$600 a day in no tax Washington is probably approaching $100 a day more in take home pay than it is in California.

While I don’t think there is an actual shortage of mariners, many companies still have the mindset that they should have a long line at the door. Those days are gone. There are just enough mariners. There is no spare capacity. No one that wants to work has to stand in line or wait for the phone to ring. If they want to work they are working.

If you want to hire good mariners, especially licensed engineers that actually know how to fix things, then you have to poach them from some other company. That means you need to pay near the top end of the standard range, not in the bottom half.

$600 a day is probably not enough to get a qualified engineer to change jobs.

Benefits (health insurance) needs to start promptly, otherwise many mariners cannot afford to make a change.

You seem to be doing most of the right things, except for the very modest day rate. If you need licensed engineers, you are going to have to pay for them.

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9

This right here.
As a sole provider of a family of four, any period longer than 30 days to be eligible for insurance is a no sale for me.

As far as the pay goes, 600 a day is probably competitive for a DDE 4000, but that license is almost an equivalent to a 100 grt deck license. Food for thought when thought of in that respect.

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10

You’ve made excellent points. Single earner for a family of 5 here. I feel exactly the same about 8hr days vs 12hrs, it doesn’t really matter if I’ve flown to a boat and can’t commute home. Food is a bonus but doesn’t offset day rate.

Same about the health insurance starting period too. I had an OSV job years ago that was decent but was offered another job where everything was better. Schedule, pay, perks, benefits, etc. But, with a newborn and 2 other young kids I had to wait 60days for the benefits to kick in and wouldn’t have taken the job if a wealthy family member hadn’t offered to cover anything that happened during those 60days. We decided to take the gamble and it worked out.

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11

I really appreciate your comments! Personally, I’m the same way, I’m on the boat and not home, therefore 8 hours or 12 hours truly doesn’t matter. I will say, once team members join us, they tend to stay and after (what I should have mentioned earlier) a probationary period, we typically find a reasonable rate to settle at… along with annual reviews.

And 100% agree about the food, that has not effect on the day rate, just something that has been repeated as hidden perk of the job.

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12

Thanks for the comment! Personally, I’m the same whether 8 or 12 hours dont matter because I’m away from home. Food certainly doesnt affect rate, but is just something that has been complimented numerous times as one of the perks. Luckily insurance kicks right in and effective immediately (although, can be delayed at the end of a month to avoid unnecessary monthly payment for say, 1 - 2 days before next cycle)

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13

If you advertise as a dayboat job, where you go home at night, this makes sense. I’m not an engineer, but I would work on a local dayboat for $600 a day. The problem is finding two, local crews, for each vessel or enough people to move there.

By my math, If I am not sleeping in my own bed, my day rate is divided by 24 hours, it doesn’t matter if I do 12 or 8 or 16. If I worked at Costco, and Costco caught on fire at 1 AM when I am not clocked in, it is not my problem. If I am attached to a vessel, and must respond to an alarm or an emergency, that is me being “On call” which should be compensated for outside a 8-12 hour workday. That and being very much a captive audience, makes a day rate is a day rate. I’ve never said “Oh, I’m not at work” at any time sitting on an employer’s vessel. So If I’m going to be gone for x number of days, I’m picking whichever one pays me more every day.

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14

Thanks for your comment & I respect and understand your thinking behind that. Honestly, even $600/day (to me personally) is a lot of money that does take into effect the outside of 8-12 hours. That covers the “what-ifs”. The industry is currently an engineers market, where they are driving the industry pay scale and, in some cases, even making more than the Master, who is their “supervisor”.

It’s difficult to advertise the dayboat thing because although we are pierside most the of the time, if operations really jumped, that could change. However, historically (even busy years like last year) most days are spent at the pier.
I guess our mission here is slightly different than the industry standard.

15

Good money is all relative. I was making around 600 a day as a chief on an ATB in 2019. At the time I felt that was competitive.

In my opinion, if the license you require is a DDE 4000 and they are filling an assistant engineer billet, that is decent pay. I wouldn’t bother interviewing anyone with a license bigger than the DDE 4000 unless you are willing to bump the pay up for the bigger license you don’t require.

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16

I disagree with this. I worked a couple of years before covid with a former, previously retired CE unlimited who only wanted to work even time or less as 3AE. As for me, I once took a lower paying job that was below my license because of scheduling, Cadillac insurance & paid travel. I stayed at that job for 3.5 years. If he only looks for DDE 4000’s, then he’s likely going to get a lot of young guys wanting stepping stone positions until they upgrade & move up. He should try to sell the strengths & benefits he has to offer & not set the bar low on who applies imo.

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I guess I did paint with too broad a brush. There’s plenty of exceptions to the rule. A chief that would rather sail as assistant taking a break from the responsibility of being chief, someone in the twilight of their career looking more for a convenient and laid back job, someone doing it for seatime purposes towards an upgrade etc…

The OP mentioned getting laughed at by applicants. Someone with a dde unlimited or bigger or even a young 3rd fresh out of school and anxious to pay off student loans, they know finding a job paying above 700 a day or even 800 a day isn’t too hard right now.

Every individual’s situation can be different and unique.

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18

Calculating by the hour $600/day for a DDE 4000 works out to be roughly $75/hr@8hr or <$45/hr@12 hr assuming OT pay for over 8. For semi-skilled labor that is pretty good. Compare to a ASE Master tech in your local auto dealership at roughly $35/hr, yes they get incentives and overtime but $50-75/hr should cover the inconvenience of the job for a DDE 4000 or DDE UNL.
One thing which is not often considered is the job stability. Countless times I have seen people chase the day rate only to be laid off a few years later for an extended time. Their average income for the period then became more like $20/hr if lucky.

19

At $600/day working equal time comes out to approx. $110k/year = $9166 monthly

Broken Down: 6% to 401k - $6600/yr
Insurance Premiums ($400/couple) - $4800/yr
Federal Income Taxes at 24% - (minus 401k contrib. and medical ins.) $23555/yr
State Income Taxes: (CA at 12.3%) $1010 month/ $12120 year
Average CA Car Insurance: $3k/year
2 Bdrm Rental Houses/Apartments in San Diego - $3000 month -$36k/year
Average Car Payment - New - $737/month, and used $530/month lets try the used at approx $6500/year

Remaining is approx $20k in year net income:
$1700/month for utilities, food, and other basic needs.

Now I ask you…Do you really think $600/day is a lot of money for a licensed engineer that has invested time and money to advance, as well as the costs to maintain documents and continued required training? Be thankful that the Inland tug companies and the extra chromosome having OSV engineers down the bayou haven’t figured out that unionizing would accelerate day rates…much like the ILA did for longshoremen and got them a 67% pay raise.

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20

There aren’t too many companies based in San Diego. I’m curious to what the job is and what type of boats. Tugs, government contract support, dinner cruises? Day rate isn’t everything, but it is a large consideration for everyone.

At that level, in southern California, your best bet is to find someone young who wants to live there. Or someone who lives there and is comfortable enough that they’re willing to take the hit in pay to be closer to home. The guys who have to travel might as well do it for more money. Which is readily available at the moment.