Fully-burdened cost
Fully-burdened cost is the total hourly cost of an employee including salary, payroll tax, benefits, software, and a share of overhead. It is typically 25% to 40% higher than salary alone.
Agencies that price off salary alone systematically underprice, because the rest of the cost stays invisible until it shows up in the annual accounts.
A working shortcut: annual salary multiplied by 1.25 to 1.4, divided by roughly 1,700 productive hours per year.
Related terms
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