Calculator
Find your break-even month.
This employee cost calculator adds salary, employer load and the one-time cost of hiring, then sets that against the hourly bill rate on your contract quote. Every default below is an editable assumption, not a market rate. Nothing you type leaves your browser.
Break-even point
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Cost only. The chart does not price ramp-up time, the weeks a seat sits empty, or what happens to knowledge when a contract ends.
How the calculator works
Two lines, one chart. The full time line starts above zero because you pay the hiring cost before the person does a day of work. After that it climbs by salary plus employer load, divided by twelve. The contractor line starts at zero and climbs by rate times hours times billed weeks, divided by twelve. If the contract month costs more, the lines cross. That crossing is your break-even month: the hiring cost divided by the monthly gap.
Before the crossing, the contractor is the cheaper option. After it, the full time hire is. If your project ends before the crossing, contract wins on cost alone.
What each input means
Annual salary is base pay. Employer load is everything you pay on top of it, and it is the number people guess most often. Ask finance for your real figure so you get the true cost of an employee, not the salary line. One-time hiring cost covers the search itself: agency fee, job ads, the hours your team spends interviewing, relocation or a signing bonus.
Hourly bill rate is the all-in rate from your quote. It already carries the contractor's pay, taxes and the agency margin, so do not add load on top. Billed weeks matters because a contractor usually bills only the weeks worked. If you expect holidays or a shutdown, lower it.
What the numbers leave out
This is a cost comparison, nothing more. A new full time hire needs time to learn your systems. A contract can end with the project, while unwinding a permanent role has its own cost. Knowledge a contractor builds can walk out with them, and contract to hire lets you test the fit before you commit. Our guide to IT contract staffing vs direct hire walks through those trade-offs in more depth.