Employee Cost Calculator: True Cost of a Hire by Role

This employee cost calculator puts the first-year cost of a US median software engineer at $167,868: a $135,980 salary [1], $19,457 of insurance and retirement [2], $11,231 of payroll taxes and workers' compensation [2][3][4][5], and $1,200 to run the hire itself [6].

Pick a role, a seniority level and an area, and the calculator prices the same model for 20 jobs.

Seniority reads as a wage percentile, from the 25th for a junior hire to the 90th for a lead. Areas cover the United States, all 50 states and Washington DC, and 50 of the largest metro areas.

Five public data sources and one HR survey carry every figure you see: the federal wage survey for salary, the federal employer-cost survey for benefits, the 2026 Social Security and Medicare rates, the federal and state unemployment rules, and SHRM's 2025 benchmarking survey for what running a hire costs. Each one is named below, next to the value it contributes.

Employee cost calculator

How this is calculated

A hire's first-year cost is salary plus benefits plus payroll taxes plus the cost of the hiring process. Written out, the first year = S + B + T + H. Every year after that is S + B + T, because you run the search once.

S is the annual wage the federal wage survey publishes for that occupation, area and percentile [1]. B is salary times the insurance and retirement share of pay for the job's occupational group [2]. T is the five employer taxes at their 2026 rates [2][3][4][5]. H starts at the SHRM median, and it is replaced by your own numbers as soon as you fill a line [6].

Here's every component with its source and its value, worked through for one hire: a software engineer at the US median wage.

The model works in cents and the rest of this article rounds to the dollar, so that hire is $167,868. Our web design cost calculator follows the same house rule, and both sit on the tools page: no coefficient goes in without a named source.

Two choices inside that table are editorial, and you should know about them. The first is paid leave. Annual wages in the federal survey are what an employer pays for the year, paid days off included. Adding a separate paid-leave line on top would charge you twice for the same days, so we left it out. That is also where the 61.43 in the table comes from: the employer-cost survey puts wages at $54.06 an hour for this group and paid leave at $7.37, and the benefit shares are measured against the sum of the two [2]. For sales and office work the same sum is $26.00 plus $2.48, or 28.48.

That choice has a visible consequence. Cluma's own graphic designer cost article loads every benefit in the employer-cost survey onto the wage, paid leave included, at a multiplier of 1.4287. It puts the $62,960 graphic designer median at $89,951 a year, where this model puts the same role at $77,257 of employer cost.

The gap is $12,694, and it isn't an error in either one. Paid leave is $7.37 of every $61.43 of pay in this group, which on a $62,960 wage is $7,554, and supplemental pay is another $3,679 [2]. Those two account for $11,233 of the gap, and the rest is the two models using a different group inside the survey and handling the taxes differently. The higher figure answers what total compensation costs. This one answers what your payroll and tax bill will be.

The second choice is supplemental pay. Bonuses and overtime are a switch you turn on, because plenty of employers don't pay either. Tick it and the model adds the group's own average, 3.59 of every 61.43 dollars of pay for management and professional work [2].

What is a burden rate?

A burden rate is everything an employer pays above the wage, expressed as a share of that wage. At the US median it runs from 22.5% to 23.6% of salary across the 20 roles in the next table, before a single dollar of hiring cost.

It only moves for two reasons. One is the occupational group: sales and office work carries a different insurance, retirement and workers' compensation share of pay than management and professional work [2].

Second come the ceilings. Social Security stops at $184,500, and both unemployment taxes stop inside the first $7,000 of pay, so a lower salary carries a slightly higher percentage. That is why customer support sits at 23.6% and an engineering manager at 22.5%.

What is the true cost of an employee by role?

At the US median, the first year of a hire runs from $56,555 for customer support to $225,244 for an engineering or IT manager, which is 1.23 to 1.33 times salary. Every row below uses the same model and the same May 2025 wage estimates, with the median cost per hire for its tier, so you can read one role against another.

Two things in that table matter more than any single row.

Start with how flat the multiple is. Every non-executive role lands between 1.23 and 1.26 times salary, whether the wage is $44,770 or $135,980. A rule of thumb is fine for a rough plan, and the wage itself is what you have to get right.

Then look at where the four management roles get their higher multiples. It is not a richer benefits package. It is the cost per hire: SHRM prices an executive search at $10,625 against $1,200 for everyone else [6].

So the highest multiple in the table, 1.33x, belongs to the lowest-paid role on the executive tier, the operations manager, because that fixed $10,625 lands on a smaller salary. We think that is the most useful thing in the table for anyone planning a leadership hire. The benefits and taxes column is the employer cost minus the salary, rounded to the dollar, so every row adds up on the page.

How much does it cost to hire an employee?

SHRM's 2025 benchmarking survey puts the median cost per hire at $1,200 for a non-executive role and $10,625 for an executive one [6]. Averages from the same survey run much higher, $5,475 and $35,879 [7], and the calculator offers them to you as a tick box for the high case.

That is a gap of more than four times on the same question, and it is worth a minute before you budget against either number.

Cost per hire has a long tail. Most hires cost very little in direct spend, and a handful that go to an agency or a long executive search cost a great deal. That tail pulls the average far above the middle.

So the median describes a typical hire. Averages describe your annual bill across many of them.

Both figures are self-reported. They come from 2,371 SHRM members who answered a survey between 9 January and 3 March 2025, and the results aren't weighted to the US employer population [6].

It is still the best public benchmark for this question, and it is still somebody else's average, which is why the calculator lets you replace it.

Time to fill sits at a median of 44 days for non-executive roles and 45 days for executive ones in the same survey [6]. Our calculator shows it in days and never turns it into money. What an open seat costs you depends on the work that isn't getting done, and no wage series measures that.

The cost of a bad hire is a different question with its own evidence, and we keep it in its own article.

What goes into a hiring cost calculator?

Ten lines, and filling any one of them replaces the SHRM benchmark completely instead of adding to it.

We made that rule deliberately. The survey figure already contains job ads, agency fees and recruiter pay, so running both at once would count the same money twice.

Four lines start empty on purpose. Job ads, background checks, relocation and equipment vary by an order of magnitude between employers, and no government series or published survey prices them per hire. A default there would be a guess wearing a source's clothes. Time-based lines are different. They're priced from your colleagues' own median wages, loaded the same way as the hire, and that is a figure the wage survey does publish. Every rate is editable, and a rate you type survives a change of role or area.

One line is missing from that list, and the absence is deliberate. There is no lost-productivity figure for the weeks a new hire takes to get up to speed. The numbers in circulation for it come from vendors selling onboarding software, with no published method behind them, so we left it out instead of guessing.

How much does an employee cost an employer per hour?

A US median software engineer costs $80.13 an hour against a wage of $65.38 an hour, which is $166,668 and $135,980 spread over 2,080 paid hours.

We leave hiring cost out of the hourly figure, because it lands in year one only.

That 2,080 is an assumption, and a standard one: 40 hours a week for 52 weeks, the same convention behind annual wages in the federal survey.

It counts hours paid, not hours worked. Paid holidays, sick days and vacation sit inside that 2,080, so your cost per hour actually worked is higher, by roughly the share of the year an employee is away.

How much does a $20 an hour employee cost an employer?

A $20 an hour employee costs about $51,447 a year, or $24.73 for every paid hour, and $52,647 in the first year once the median cost per hire is added. Here's the whole sum, next to the same employee at $15.

Both columns rest on one assumption you'll want to check against your own payroll: the sales and office occupational group. Its average wage of $26.00 an hour is the closer of the two groups to these wages, so its benefit shares are the ones applied here, instead of the management and professional group at $54.06 an hour [2]. A $20 an hour job in a group with richer insurance would cost you more.

How much does a $15 an hour employee cost?

A $15 an hour employee costs about $38,626 a year, or $18.57 for every paid hour, and $39,826 in the first year with the median cost per hire. Its multiple sits slightly higher than at $20 an hour, because the two unemployment taxes are flat amounts inside the first $7,000 of pay and the wage underneath them is smaller.

Does location change what a hire costs?

Yes, twice over.

Almost all of what you pay comes through the wage rather than the taxes. The same mid-level software engineer has a median wage of $186,640 in the San Francisco-Oakland-Fremont metro against $135,980 nationally [1], and costs $228,687 a year against $166,668. That is $62,019 more for the same job at the same seniority.

State unemployment tax moves far less than people expect. California's average employer rate is 3.46% of taxable wages against a US average of 1.75%, both on the first $7,000 of pay [5]. That is $242 a year in California against $122.50 nationally, a difference of about $120 on a six-figure hire. So wage levels are what's worth modelling by location, not the tax table.

The calculator prices the United States, all 50 states and Washington DC, and 50 of the largest metro areas. Where the wage survey publishes no wage for a role at that level in a metro or a smaller state [1], it uses the state figure, then the national one, and says so under the result. State taxes still follow the area you picked.

Where this breaks

Every number above is a public estimate run through a formula you can see, which makes the limits as checkable as the figures. These are the ones that would change a decision.

• Seniority is a wage percentile, not a job level. A 25th-percentile wage is a wage, not a junior title, and your own pay bands line up with it only loosely.
• Benefit shares are group averages. That survey publishes them for broad occupational groups and not per occupation [2], so a startup with no retirement match and a bank with a rich one get the same coefficient here.
• State unemployment is a state average, and not your rate. Experience rating gives every employer its own rate, and a new employer is assigned a different one again [5].
• Federal unemployment is $42 only with the full state credit. Employers in credit-reduction states pay more [4].
• Hiring figures are self-reported and unweighted, from 2,371 SHRM members surveyed in early 2025, and the median leaves out the time your interviewers spend [6]. The itemized lines exist because of that gap.
• Wages are about a year old. May 2025 estimates were published in May 2026 [1], so fast-moving pay bands are understated.
• Workers' compensation loses its source. That series leaves the employer-cost survey with the March 2027 release of December 2026 data, because too few employers answered the question [8]. Worth about 0.5% of salary here, the line will need a different source after that.
• Two role mappings are approximations. UI/UX or product designer uses the web and digital interface designers occupation, and the sales rep row uses sales representatives for technical and scientific products. Neither is an exact match for your SaaS job description.
• Product manager and growth marketer are absent. Federal classification publishes no occupation for either, so we have no wage to show you.
• Contractors and freelancers are not modelled. Wage survey estimates cover employees on a payroll [1], and a contractor rate is a different market with none of these taxes in it.
• There is no onboarding productivity loss. Only vendor estimates exist for it, so the first-year figure is a cash cost and not a full economic one.
• Paid leave sits inside the wage here. That's why this model gives $77,257 for a graphic designer where our own total-compensation article gives $89,951. Both are defensible, and they answer different questions.

If a first-year figure in that table is the reason a design role keeps slipping down your plan, there's another way to get the work done. Cluma runs product, website and brand design as a flat monthly design subscription for SaaS teams, with senior designers on your roadmap and modules you can add or pause as the quarter changes. We built this calculator because the question behind it comes up in most first conversations.

References

1. US Bureau of Labor Statistics, Occupational Employment and Wages, May 2025, released 15 May 2026, read 28.10.2026. Behind every wage here and in the calculator. It publishes the annual median and the 25th, 75th and 90th percentiles per occupation, nationally and by state and metro. Limitation: it covers employees on a payroll, so freelance and agency rates are a different market, and May 2025 estimates published in May 2026 are about a year old.
2. US Bureau of Labor Statistics, Employer Costs for Employee Compensation, table 4, private industry workers by occupational and industry group, June 2026 reference period, read 28.10.2026. Behind the benefit shares of pay. Insurance, retirement, supplemental pay and workers' compensation, for the two occupational groups this model uses: management and professional work, and sales and office work. Limitation: they are averages for broad occupational groups, not single occupations, so one employer's package can sit well away from them.
3. Social Security Administration 2026 wage base, as reported by the Journal of Accountancy, Social Security wage base and COLA announced for 2026, 24 October 2025, read 28.10.2026. Behind the two federal payroll taxes. Social Security at 6.2% of pay up to $184,500, and Medicare at 1.45% with no ceiling. Limitation: these are the employer-side rates for calendar year 2026 and they are reset every autumn.
4. Internal Revenue Service, Topic no. 759, Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return, read 28.10.2026. Behind the federal unemployment line. The tax is 6.0% on the first $7,000 of pay, falling to 0.6% with the full 5.4% state credit, which is the $42 this model charges. Limitation: employers in credit-reduction states get less than the full credit and pay more.
5. US Department of Labor, Employment and Training Administration, Estimated Employer Contribution Rates, Calendar Year 2026, read 28.10.2026. Behind the state unemployment line. It lists each state's taxable wage base and average employer rate, including the United States at 1.75% of $7,000 and California at 3.46% of $7,000. Limitation: a state average, while your own rate depends on your claims history, and new employers are assigned a separate rate.
6. SHRM, Data brief, 2025 Recruiting Executives Benchmarking: Insights to Maximize Recruitment, read 28.10.2026. Behind everything here about running a hire. The median cost per hire of $1,200 for non-executive and $10,625 for executive roles, the median time to fill of 44 and 45 days, and the survey method. Limitation: self-reported by 2,371 SHRM members surveyed between 9 January and 3 March 2025, not weighted to the US employer population, and the cost figure leaves out interviewer time.
7. SHRM, SHRM Releases 2025 Benchmarking Reports: How Does Your Organization Compare?, read 28.10.2026. Behind the high case. The average cost per hire of $5,475 for non-executive and $35,879 for executive roles, which the calculator offers as a tick box. Limitation: it reports the same 2025 survey as the data brief above, and these averages are published only in the release.
8. US Bureau of Labor Statistics, Removing workers' compensation costs from the Employer Costs for Employee Compensation, read 28.10.2026. Behind the warning that the workers' compensation line loses its source. BLS drops the series with the March 2027 release of December 2026 data, because fewer employers answer that question than the others. Limitation: a notice about future data, which does not change the June 2026 figures used here.