From: J. Andrew Rogers (andrew@ceruleansystems.com)
Date: Thu Nov 04 2004 - 18:10:33 MST
My point was more that 6 x $25k salaries does not even come close to
$150k. By the time you factor in taxes, insurance, compliance, probably
health insurance, and who knows what else, the actual cost per person is
substantially higher than $25k. As a rule of thumb, the cost of a
person after you factor in all the overhead and indirect costs is twice
what you pay them as direct wages. For a tight organization, you can
get by with signifantly less than 2x the wages though.
People often underestimate the cost of an employee in the same way that
people often underestimate the monthly recurring cost of owning a home
(frequently about 1.5x the mortgage payment in practice).
j. andrew rogers
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