True cost of an employee calculator
Salary is only the starting point for a hiring plan. Add payroll taxes, benefits, and recurring overhead to estimate the annual and monthly cash commitment behind one employee.
Open the interactive calculator
Inputs and formula
- Base salary: annual cash compensation before employer costs.
- Benefits percentage: health coverage, retirement match, bonuses, and other salary-linked benefits.
- Annual overhead: software, equipment, office, training, and other costs that do not scale as a percentage of salary.
- Loaded cost = salary + (salary × 7.65% payroll-tax estimate) + (salary × benefits %) + annual overhead.
Worked example
At an $80,000 salary, 15% benefits, and $5,000 of annual overhead, the estimate is $80,000 + $6,120 payroll taxes + $12,000 benefits + $5,000 overhead = $103,120 per year, or about $8,593 per month.
Caveats and next decision
The 7.65% figure is a simplified US FICA estimate and does not include state unemployment, recruiting, severance, variable bonuses, or location-specific benefits. Use a finance-approved burden rate for a budget, then compare the result with runway and the value of the role—not with salary alone.
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