Employee Cost Calculator
Find the true, fully-loaded cost of an employee — annual and per hour. Factor in payroll taxes, workers' compensation, benefits, and overhead. Free, instant, no signup.
Tell us about the role
Pick a state and profession to auto-fill realistic tax & insurance defaults.
Customize rates & costs (editable estimates)
All values are editable. Defaults adjust when you pick a state and profession.
Employer payroll taxesFully-loaded cost
Updates live as you type.
What to charge clients (billable rate)
Turn the loaded cost into the hourly rate you must bill to hit your profit goal.
W-2 employee vs 1099 contractor
A 1099 contractor carries no employer payroll taxes, benefits, or workers' comp — but usually bills a higher rate. Enter their rate to compare.
W-2 employee (fully loaded)
1099 contractor
Employee cost calculator — FAQ
What is the true cost of an employee?
The true, fully loaded cost of an employee is far more than their wage. It includes employer payroll taxes (Social Security, Medicare, FUTA, and state SUTA), workers' compensation, benefits, retirement contributions, paid time off, and overhead. A typical employee burden rate adds roughly 1.25× to 1.4× on top of base pay, and more for trades with high workers' comp.
How do you calculate labor cost per hour?
This labor cost calculator divides the total annual cost by the employee's actual productive hours — scheduled hours minus paid time off, holidays, and sick days. That gives the true hourly labor cost, which is what each working hour really costs you.
What's a typical employee burden rate?
Most U.S. employers see a fully loaded cost of about 1.25×–1.4× base pay for office roles, and higher for trades where workers' compensation and equipment costs are significant. Your exact rate depends on state, industry, and the benefits you offer.
How much should I charge per hour for an employee (billable rate)?
Use the “What to charge clients” section. It divides the total annual cost by your billable hours (productive hours minus non-billable time such as admin, travel, and training), then applies your target profit margin to give the hourly rate you should bill clients so the role stays profitable.
What’s the difference between productive hours and billable hours?
Productive hours are paid hours minus paid time off, holidays, and sick days. Billable hours are the portion of those productive hours you can actually bill to a customer. Dividing cost by billable hours — not just paid hours — gives the most realistic rate to charge.
Can I calculate the cost for my whole team?
Yes. Enter the “Number of employees” and the calculator shows your total team cost per year and per month alongside the per-employee figures.
All results are rough estimates, not guarantees or quotes. The built-in default rates — including federal payroll taxes, state unemployment (SUTA), workers’ compensation, benefits, retirement, and overhead — are approximations that change frequently and vary by employer, state, industry, insurance carrier, wages, and individual circumstances. Your actual SUTA rate is assigned individually by your state; your actual workers’ compensation rate depends on your class codes, carrier, and claims history. We do not warrant that any figure is accurate, current, or applicable to your situation.
You are solely responsible for independently verifying every figure with the IRS, your state agencies, your insurance carrier, and a qualified accountant, attorney, or payroll professional before making any hiring, business, financial, or tax decision. To the fullest extent permitted by law, the owner and operators of this site disclaim all liability for any loss, damage, cost, or decision arising from use of, or reliance on, this calculator or its results. By using this calculator you acknowledge and accept these terms.