True Cost of an Employee Calculator
What a hire actually costs — salary, taxes, benefits, equipment, and workspace.
US employer FICA + FUTA + SUTA ≈ 7.65–10%.
Rent ÷ headcount, or home-office stipend.
The salary you offer is not what an employee costs you. A $75,000 hire typically costs the business $95,000–$110,000 all-in once you add payroll taxes, benefits, equipment, workspace, and onboarding.
Use this calculator before approving any headcount request. It changes how you think about contractors, outsourcing, and software-vs-hire trade-offs.
True cost = Salary + (Salary × Tax%) + Benefits + Equipment + Workspace + Training
The cost multiplier (true cost ÷ salary) usually lands between 1.25× and 1.4× for full-time US employees.
Founders consistently undercount headcount cost by 25–40%. That's why "we'll just hire someone" plans bust budget by Q2. Software, contractors, or process changes often clear the same job at 30–60% of the loaded cost.
Worked examples
$6.4k payroll taxes + $9k benefits + $3.5k equipment + $4.8k workspace + $1.5k onboarding = ~$100k true cost (1.33× multiplier).
~$160k all-in. Consider whether a fractional PM at $8k/mo for 6 months ($48k) gets you the same outcome.
- Forgetting employer-side payroll taxes (FICA, FUTA, SUTA).
- Pricing health benefits at the employee's contribution rather than the full premium.
- Ignoring software licenses (Slack, GitHub, Notion, etc. — easily $200/mo/seat).
- Counting one-time equipment as zero across years instead of amortizing.
Software based on your result
Hand-picked tools we'd actually pay for. Free where possible.
Frequently asked questions
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