6 ms·
An employee with a 100k salary costs something like 200k to the employer. Contractors also expect a bit of a premium due to getting sporadic work, if they didn
by furyofantares 15y ago
An employee with a 100k salary costs something like 200k to the employer. Contractors also expect a bit of a premium due to getting sporadic work, if they didn't get a premium they'd opt for stable work instead. In exchange for this premium you get someone you can stop paying the second you don't need them, and someone who presumably doesn't need training. A salaried employee worth 100k salary should expect somewhere around $100/hr contracting. But the average should be higher yet, because the average contracting job requires more experience than the average salaried job.
- mahyarm 15y agoIs it really double? The employer's side of FICA adds ~$15k , whatever the state adds to the employer adds a few more thousand. Lets be extravagant and say each of these line items cost $12k/year ($1k/month): * Office space, utilities, parking space * Health Insurance * Administrative Overhead * Office Equipment It comes out to around $168k/year. And I know almost nobody spends that much on each of those items.
- mechanical_fish 15y agoYou left out the time required to market yourself and look for new gigs, the allowance for empty space in your schedule (it's hard to manage a pipeline even in a factory where you have insane degree of control; don't expect perfect scheduling as a consultant) and a safety margin to cover the clients who don't pay thir bills. That said, "double" is a rule of thumb. Physicist law states that 1.68 is equal to two for rule-of-thumb purposes. ;)
- moocow01 15y agoActually I look at some of these breakdowns for large corps. You're pretty much spot on with your number. 100k employee is usually a line item at around 160k. Obviously depends on the org and role but thats a very safe average.