Employee Cost Calculator
Find the true cost of hiring — salary is just the starting point.
Enter Employee Details
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Average employer cost: $500-$700/month. Enter 0 if not offering.
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Office: 0.5-1% · Services: 1-3% · Construction: 5-15%
Cost Breakdown
Base Salary
Social Security (6.2%)
Medicare (1.45%)
FUTA (0.6%)
Workers Compensation
Health Insurance (Annual)
Total Annual Cost
That's the base salary
Monthly Cost
Hourly Cost (2,080 hrs)
Common questions
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Frequently Asked Questions
Q.01 How much does an employee really cost beyond salary?
The true cost of an employee is typically 1.25x to 1.4x their base salary. A $50,000/year employee actually costs $62,500-$70,000 when you add employer payroll taxes (7.65% FICA), unemployment insurance (FUTA/SUTA), workers compensation, health insurance, and other benefits.
Q.02 What payroll taxes does an employer pay?
Employers pay 6.2% Social Security tax (on first $168,600 in 2024) plus 1.45% Medicare tax — totaling 7.65% of wages. You also pay federal unemployment (FUTA) of 0.6% on the first $7,000 per employee, plus state unemployment (SUTA) which varies by state from 0.5% to 5.4%.
Q.03 Do I need workers compensation insurance?
Almost every state requires workers compensation insurance once you hire your first employee. Texas and a few states make it optional. Rates vary by industry — office work costs about 0.5-1% of payroll while construction can be 5-15%. Most service businesses pay 1-3%.
Q.04 When should I hire my first employee?
Hire when you are consistently turning away work or working unsustainable hours (60+ per week) for at least 3 months. Make sure you can afford the full loaded cost (1.3x salary) for at least 6 months from savings or revenue, not just the base salary.