Posted by: patenttranslator | January 18, 2014

What Is Behind the Relentless Pressure to Lower Rates Paid to Translators by Certain Translation Agencies?

 

It is not a secret that just like the minimum wages being paid to millions of indispensable but grossly underpaid workers in the fast food industry, rates being paid to translators have not kept up with inflation in the last decade. For the most part, they either stayed the same (which means that they went down taking into account inflation), while in some cases they were lowered by some translation agencies (which would mean that they basically collapsed and were replace by starvation rates).

Of course, this is true only about a certain segment of the translation market, in particular the segment that is based on the corporate model of a relatively large translation agency. Some smaller translation agencies followed the suite, or tried to do so, but perhaps not that many, and definitely not all of them.

This translator/translation agency hybrid did not decrease the rates paid to translators, although I did not increase them either.

The main reason why large translation agencies try to pay less and less to people who do the actual work is not that difficult to figure out. What drives the large translation agency model, or corporate translation agency model, is old-fashioned greed, coupled with the urgent need to compete on price.

Unlike quality, price is something that can be calculated instantly. Quality has many ephemeral characteristics that are difficult to define, quantify and measure, and in any case, most large translation agencies – in particular those who “specialize” in everything – are unable to determine what quality in translation means.

The corporate translation model has a relatively large overhead. The model is dependent on a network of far-flung offices often located in different countries. Because in addition to paying for translators, this model must pay for these offices with their project managers, accountants and sales people, instead of being considered the real creators of the product, translators are perceived as just another, additional expense that needs to be minimized to pay for the overhead and, most importantly, to ensure a healthy profit for the owner of the enterprise.

As most translation agencies are daily inundated with hundreds of e-mails with résumés  from would-be translators, to project managers trying to makes sense of this avalanche of résumés it must seem as though the world is full of translators who are eager to work for peanuts.

The logical question seems to be: So why not feed them peanuts? The logical answer is that people who are willing to work for peanuts usually produce garbage because they are not really translators.

But that is not necessarily how a corporate agency owner would answer this question.

We have seen several entertaining examples in 2013 illustrating the mindset so common in the corporate translation model.

A UK-based agency called Applied Language Solutions (ALS), frequently discussed on translators’ blogs in 2013, decided last year to cut the pay of interpreters to between 16 to 22 pounds (25 to 35 dollars) per hour, which amounted to a 60 to 80% cut in pay. Due to the incredibly low rate offered to interpreters, the agency then began to be boycotted by most of the interpreters who used to work for the company.

One devious Czech interpreter filled in an online application and successfully enrolled her pet rabbit Jajo as a qualified linguist. Although Jajo wasn’t even a talking rabbit, let alone a bilingual interpreter, ALS warmly welcomed the carrot chomping pet to its recently depleted stable of court interpreters and invited him to participate in seminars. This entertaining episode, illustrating how “strict quality control” is in practice exercised by large translation agencies, was covered by the news in UK, and of course it was all over the translators’ blogosphere.

Another UK-based agency, affectionately referred to among translators as “The Pig Turd”, sent last year to all translators a note asking all translators to voluntarily take an obligatory pay cut to remain “viable in this very competitive market place”. Later, translators who obediently lowered their rates to offer “more realistic rates” for their work to their favorite translation agency found out from newspapers that the director of the company took home a discretionary bonus of £1.68 million.

Even small and very small translation agencies caught the rate-cutting disease last year. A tiny agency, a one-man outfit that I have been working for since 1994, suddenly cut the rates I was to be paid in the future for translating Japanese, German and French patents by about 15%.

So I started ignoring the guy’s e-mails, and after a while he got the message and stopped sending them.

The relentless pressure to try to lower the rates paid to people who do the actual work, called translators, is clearly driven mostly by greed, as well as by an attempt to compete based mostly on price.

If you can’t compete on quality, price is the only thing that you can compete on, and the only way to be able to offer low prices while maintaining a high profit margin is to drastically reduce the amount of money that you pay to translators.

***************

Given the generally dismal situation based on the corporate translation model (low rates = low quality = poor prospect for translators), is there a silver lining on the horizon?

I personally do believe so. To quote, Rahm Emanual, the unscrupulous mayor of Chicago, “Never let a serious crisis go to waste”.

The corporate translation agency model, which is very different from the old translation agency model as I wrote in this and other posts, clearly creates a market opening for translations that are of a higher quality than what the corporate model is able to supply most of the time.

There must be a considerable amount of customer turnover and customer attrition in the corporate translation model as all the large translation agencies attempt to attract large projects by offering lower and lower rates.

Moreover, in the highly fragmented translation industry, the big corporate agency players play an important role, but not a decisive role. It is possible to calculate how much the big players are making every year based on public disclosures, but nobody really knows how much the entire market is worth. Estimates can be made, but only estimates, and who knows how accurate these estimates are?

I think that the present “quality crisis” in the translation industry, which is caused mostly by unbridled greed on the part of the big players, creates an opening for smaller players who can provide specialized services at a much higher level of quality than what the large translation agencies are typically delivering.

I am talking about small, specialized and not quite as greedy translation agencies, namely businesses that are interested only in highly educated, experienced translators, even though they may cost a little bit or quite a bit more than their much cheaper counterparts, because at some point, disappointed customers are likely to dump a translation supplier who is supplying translations that don’t work and start looking for alternatives.

I am also talking about individual translators who specialize in a given field and who can use the Internet and other means to connect directly with clients who are looking for better quality than what is available from the large agency model.

The choice that translators are facing in the current labor market is either to accept the conditions imposed on them by the corporate translation agency model in order to survive, including in particular low rates, discounts for “full and fuzzy matches and repetitions” based on translation memory tools, and extremely restrictive, unfair and demeaning contracts called “Non-Disclosure Agreements”, or to reject these conditions and look for alternatives.

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Responses

  1. Good post, as usual.

    (Note: I’m only commenting so you know I’m still here.)

    Like

  2. @Rob

    And I appreciate it.

    Like

  3. Hi Steve,

    I’ve been following your blog for awhile and greatly appreciate your honest perspective on the translation business.

    To add to the dialogue, while I agree to the greed profit motive driving agencies, there are also forces at work accounting for the decreasing pricing. Two obvious forces are technology and globalization. In our business at http://chineseTranslationHelp.com which is mostly legal contracts in Chinese/English, a lot of contracts are coming from templates that law firms use over and over and languages tools definetely reduce the cost of this on our side and some would say should be passed on to the customer also. Once a contract is translated and put into a tool, if another comes in with the same phrases and wording, our cost is lower for this translation. One could argue that our overhead in setting up the tool and using it is only internal but when the technology is ubiquitous I think we are seeing the result of the proliferation of tools and technology in the pricing model. For globalization, just like the decimation of the auto and manufacturing industry in the United States, wages are lower in different countries and it is indeed hard to compete on price when companies can pull translators from universities in lower wage countries. Just as car quality has not necessarily decreased because of this I don’t think lower prices equate necessarily with decreased quality in translation because of these 2 forces at work.

    We have not raised our prices for years and lowered them in 2008 based on our feedback from customers because of these two factors.

    Luckily we don’t work with the multilanguage companies for the most part and avoid their unscrupulous practices.

    –Joe

    Like

  4. @ChineseTranslationHelp

    I agree with you that there are more factors at play than those I mention in my post and thank you for identifying additional ones.

    Like

  5. Loved your “The Pig Turd” designation! We had a pretty mixed experience working for them but after reading about the same tale of greed that you referred to we notified them in no uncertain terms that we were ceasing from any further cooperation with them. A decision that we shall never regret. 🙂

    Like

  6. “Loved your “The Pig Turd” designation”

    Thank you, but I am not the author.

    Kevin Lossner from Translation Tribulations came up with the name as linked in my post.

    I think it’s pure genius!

    Like

  7. >Kevin Lossner from Translation Tribulations came up with the name as >linked in my post.

    >I think it’s pure genius!

    100% in agreement!

    Like

  8. ‘Unbridled corporate greed’ in the US of A?
    Surely not!

    Like

  9. Translating is not a business, it is a profession.
    The current trends prove my point: http://www.doubledutchtranslations.com

    Like

  10. @ Louis

    https://patenttranslator.wordpress.com/2013/10/21/the-problem-with-the-translating-profession/

    Like

  11. […] It is not a secret that just like the minimum wages being paid to millions of indispensable but grossly underpaid workers in the fast food industry, rates being paid to translators have not …  […]

    Like

  12. Steve, thank you for the mental shampoo you pour on us from time to time.

    Like

    • Mental shampoo?

      I think of it more as a nectar of wisdom from Mount Olympus.

      Like

  13. Hi and thanks for your article. I wonder though if the issue isn’t only greed, but greed combined with ignorance on the part of the end client. There seem to be a lot of people out there who have no clue as to the skill and effort involved in producing a quality translation. I suspect it’s not too hard for some translation companies to convince their clients that their job can be done cheaply if they don’t really understand the process in the first place.

    Like

  14. @Louisa

    It is true that most end clients don’t know anything about translation, but all this talk about the need to “educate clients” makes no sense to me.

    I don’t know anything about cars, and I don’t want to be “educated” about them, beyond the basics that I need to know to drive them safely.

    I just want to know a car shop in my area that does the best work at the lowest cost when I need some work to be done on my car. Once I find a shop like that, I am likely to stick with it for many years, unless I think that they do shoddy work or charge me too much.

    I don’t consider myself greedy or uneducated when it comes to cars, and I don’t see why the attitude of customers who need translations toward translations and translators should be any different from my attitude to cars, car shops, and car mechanics.

    Like

  15. Next time I negotiate for a rise in rates, I will look at the company report and accounts first.

    Like

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