What does a new hire
really cost?
Base pay is just the beginning. Enter a salary and see what that employee actually costs you after payroll taxes, workers comp, insurance, PTO, and overhead.
Employee details
Auto-fills payroll taxes and health insurance for your state
Burden costs
Auto-filled for your trade. Adjust to match your actual costs.
Training, supervision, scheduling, quality checks
True cost of this employee
vs $25/hr base wage
burden multiplier (wage x this = true cost)
Annual cost breakdown
Revenue this employee must generate
To be profitable, this employee needs to bring in at least:
to break even
for 20% profit on them
Disclaimer: This calculator is for informational purposes only. Results are estimates based on the inputs you provide and industry averages. Actual costs and revenue may vary based on your market, business model, and other factors. Consult with a financial professional for specific business decisions.
State payroll tax rates: Patriot Software / state DOL. Health insurance: MEPS-IC / KFF 2024. Last updated: May 2026.
Frequently asked questions
Why is the true cost so much higher than the wage?+
Because of mandatory costs that sit on top of every dollar of wages. Employer FICA alone is 7.65%. Workers comp varies by trade but can be 5-25%. Then add health insurance, PTO, uniforms, tools, vehicle use, and the time you spend managing them. For most trades, the true cost is 1.25-1.50x the base wage.
How does this affect what I charge customers?+
Your hourly rate to customers must cover the true cost of labor (not just the wage), plus overhead, plus profit. If you're pricing based on what you pay the employee per hour, you're undercharging. Use our Rate Calculator to build a complete rate.
When should I hire vs stay solo?+
Hire when you're consistently turning away work and the revenue from that work exceeds the true cost of the employee. The revenue threshold (shown above) is the minimum the employee needs to generate. If your pipeline can support it, hire. If not, you're paying for capacity you can't fill.