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I've always heard that, for the US, when thinking about salary you want to about double what the employee makes when considering the employers cost.
by eikenberry 6y ago
I've always heard that, for the US, when thinking about salary you want to about double what the employee makes when considering the employers cost.
- qeternity 6y agoThis might apply to large organizations with lots of overheads and perks. But it definitely does not apply to startups.
- Closi 6y agoThis is overkill, add 35% to the top and you will be closer (depending on absence/sick levels). Statutory allowances in the UK are higher than in the US, and in the UK for instance you would add: - 12.5% national insurance + apprentice levy - 3-4% pension - 10% of days as holidays - 5% of days as sick / other leave (dependent on amount taken in reality) - 2% payroll fees / other Note, this excludes training and equipment/office space.
- petercooper 6y agoWhy add holidays and sick leave to an individual employee's costs? Most white collar employees would have an annual salary this is factored into already, unless you're having to hire temporary replacements for them perhaps (which would be more than a 15% cost, I suspect).
- Closi 6y agoYou are right, I usually do this to get to a worked daily or worked hourly cost (I work in consultancy) so I take holidays & sick into account to understand cost per worked hour / cost per worked day. In reality it depends on the type of work you are doing.
- petercooper 6y agoAh! Definitely makes sense in consulting/contracting :-)
- cameronh90 6y agoI guess it depends when there you consider other costs like office space, equipment, utility bills, HR overheads, consumables etc.
- TylerE 6y agoThat metric isn't just about actual payroll expenses, but also things like office space, janitorial services, etc.
- eikenberry 6y agoHealth insurance is another big one in the states.
- IkmoIkmo 6y agoIn NL it's about 35%. Doubt other countries vary that much, probably a lot in the 25-40% range.