When making a new hire, it’s always important to examine not only the benefits that an extra mind and pair of hands will bring, but also the costs: the bottom line. Many assume that this bottom line will merely consist of whatever salary the new employee is paid, but in reality, the cost of a new hire is almost always higher than this baseline.
According to today’s source article from CNN Money, the total cost of adding another employee to the payroll is usually 18%-26% higher than cost of their salary. Mostly, this money goes into benefits such as medical and dental coverage. The other costs that bosses have to consider are a whole rainbow of taxes from Medicare to State Unemployment Insurance on top of Payroll Taxes and 401(k) contributions.
What’s more, employees may need up to a half a year of their salary in training before they can begin producing at a company. The bottom line about the bottom line is that it isn’t where a lot of people expect it to be. To read more about how much a new hire will actually cost you, click the link below, or click here to measure your cost per hire.