The fully-loaded cost of a hire — salary plus FICA, FUTA, SUTA, 401(k) match, benefits, and overhead — with the true hourly rate and markup shown.
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FORMULA USEDEmployee Cost Calculator
Salary is the floor, not the cost
The employer side of payroll adds taxes the paycheck never shows: Social Security at 6.2% up to a wage base, Medicare at 1.45% with no cap, FUTA at 0.6% on the first $7,000, and SUTA (state unemployment) on the first $9,000 at your state rate. Stack on benefits, the 401(k) match, and a desk, and a $60,000 salary easily becomes a $77,000 line item.
How each tax actually behaves
Social Security and FUTA stop applying once wages pass their ceilings — a $200,000 salary pays Social Security on only the first $168,600, but Medicare never stops. SUTA is computed on a small wage base, so it matters most for employers with many part-year workers. The defaults here use those standard bases; swap in your state’s notice of unemployment insurance rate for a real budget.
What the markup number is for
The markup — total cost over salary — is what staffing firms and consultancies build pricing on, and what a healthy services business checks before quoting. A 25–40% markup over salary is typical for office roles; if your quote to a customer sits below the fully-loaded cost, every hour billed is a quiet loss.
Worked example
A $60,000 office hire: benefits $6,000, 401(k) match 3%, SUTA 2.7%, overhead $4,000.
Employer FICA = $3,720 Social Security + $870 Medicare = $4,590; FUTA $42; SUTA $243.
True hourly = 76,675 ÷ 2,080 = $36.87, a 27.8% markup over salary.
How to use it
Enter the base salary — gross wages, not take-home pay.
Add annual benefits and the 401(k) match percent your plan offers.
Replace the SUTA default with the rate from your state notice.
Read the fully-loaded total, hourly rate, and markup on the board.
Frequently asked questions
What is the true cost of an employee?
Base salary plus employer payroll taxes (FICA, FUTA, SUTA), benefits premiums, retirement match, and overhead such as equipment and workspace. For typical office roles the fully-loaded cost lands 25–40% above salary, though lean benefits packages can bring that under 20%.
What payroll taxes must employers pay?
Social Security at 6.2% of wages up to the annual wage base ($168,600 in 2024, $176,100 in 2025), Medicare at 1.45% with no ceiling, FUTA at 0.6% of the first $7,000, and state unemployment (SUTA) at your assigned rate on your state’s wage base. These match the employee-side FICA withheld on paychecks — the total tax on wages is 15.3% up to the base, split evenly.
How do FUTA and SUTA tax work?
Both are unemployment insurance taxes paid only by the employer, and both apply to a small wage base — FUTA on the first $7,000 per worker, SUTA typically on the first $9,000 or so. FUTA is effectively 0.6% after the standard 5.4% credit for state taxes; SUTA rates vary by state, industry, and the employer’s layoff history.
What employee cost markup is typical?
A fully-loaded cost 25–40% above salary is the common band for office and professional roles. Heavy benefits, equipment-intensive work, or high-SUTA industries push higher; remote contractors with no benefits sit lower.
Should operational overhead be included in employee costs?
For budgeting, yes — the laptop, software seats, and share of rent are real costs of having the person. For comparing offers or setting bill rates, some firms isolate overhead so staffing costs stay comparable across locations; just be consistent about which number you quote.