Guide
What a hire actually costs, beyond salary
Updated
Budgets are built on salary and roles cost more than salary. Four lines account for the difference and all of them are estimable from your own records.
Employer costs
Payroll taxes, benefits and insurance sit on top of salary and vary substantially by jurisdiction and by what you offer. This is the largest addition and the easiest to obtain accurately, because it is in your own payroll.
Take the percentage from your own numbers rather than from any general figure, including the default in the calculator here.
Equipment and workspace
Laptop, software licences, phone, desk if you have offices. Modest individually and real annually, and usually forgotten because it is booked somewhere else.
Include it, because the AI side of the comparison has no equivalent and leaving it out silently favours the hire.
Recruitment, spread over tenure
Agency fees or advertising plus the time of everyone who interviewed. Spread it over how long people in that role actually stay rather than over an optimistic figure.
Short tenure roles carry this cost repeatedly, which is exactly the kind of role where the comparison is usually being made.
Management time
A role needing a few hours of a manager's week is consuming a meaningful slice of a senior salary. It is the least visible cost and often the largest after employer costs.
Estimate it honestly. A junior hire who needs daily direction is a different proposition from an experienced one who needs a weekly check-in.