Worked example
How to calculate fully loaded employee cost
Salary is the offer letter. Fully loaded cost adds the employer’s burden and the extras you buy for that seat. $80,000 plus a 30% burden and $3,000 of extras is $107,000 a year. After PTO and a 70% focus rate, that is $79.61 per hour of real work.
Formula
fully loaded = salary + (salary × burden%) + extras
productive hours = weekly hours × (52 − PTO weeks) × focus%
productive hourly cost = fully loaded ÷ productive hours
Burden is employer payroll tax, benefits, and insurance you fund — often 25–40% of salary, depending on country and package. Extras are the laptop, software seats, and other annual costs tied to the person. Focus is the share of desk time that is actual work, after meetings and admin. A 40-hour week at 70% focus is 28 hours of output.
Example: $80,000 salary
| Base salary | $80,000 |
|---|---|
| Burden, 30% | $80,000 × 0.30 = $24,000 |
| Extras | $3,000 |
| Fully loaded | $80,000 + $24,000 + $3,000 = $107,000 (1.34× salary) |
| Per month | $107,000 ÷ 12 = $8,916.67 |
| Work weeks | 52 − 4 weeks PTO = 48 |
| Hours on the clock | 40 × 48 = 1,920 |
| Focused hours, 70% | 1,920 × 0.70 = 1,344 |
| Productive hourly cost | $107,000 ÷ 1,344 = $79.61 |
Dividing $107,000 by 2,080 (40 × 52, ignoring leave and focus) gives about $51 an hour. That number is too low for a meeting clock or a client rate. Use the productive hourly cost when the question is “what does an hour of this person’s attention cost?”
Open this example in the employee cost calculator
Other write-ups: SaaS pricing, LTV to CAC, working hours overlap.
Cite: Do One Job — How to calculate fully loaded employee cost. https://doonejob.com/fully-loaded-employee-cost/