Not doubting this at all but could you (or someone else) break this down for the sake of my curiosity?
I understand pension contributions, but what are the other "hidden" costs that could equal the net salary?
Not doubting this at all but could you (or someone else) break this down for the sake of my curiosity?
I understand pension contributions, but what are the other "hidden" costs that could equal the net salary?
In the UK, a £45k/yr employee pays their own tax and gets a take-home of £35k.
The employer pays £6k for National Insurance (atop the employee's NI contributions). Pension: 2-3k. Apprenticeship levy is £300. 3yr-amortised recruitment fee is £4000. Hardware costs: £1000. Office space £5000. Software/tools: £2500. Benefits: £1500. Training: £1000. Other admin overheads £500.
You pay that person for ~250 working-days, but they only attend for ~220, due to annual leave and sick pay, so you get around £62k worth of attendance out of that person in exchange for £70k, of which the employee sees £35k.
In the UK, employers pay a stealth tax of 15% (recently increased from 13.8%) on top of the quoted salary minus the first £5k (recently decreased from £9,100.)
So your "£50k" salary actually costs your employer £56,750, and that's before all the other expenses mentioned elsewhere in this thread such as hardware, office rent etc.
Example from Germany: Employer also pays a share of health insurance, unemployment insurance, public pension and elder care insurance.
This is not visible on your payslip, i.e. if you earn 5k€ brutto, the employer has to pay these shares on top of that.
But that is 20% not 100%. And in most non retarded countries brutto is actually brutto, because there is no need to lie to people about how much the government takes away
The 100% figure is coming from the comment above mine, actually. As for the rest of your comment, your assessment is noted.
A quick google tells me that software devs usually count for 20% to 40% of the total workforce in a software company. The rest is overhead that increases with every added dev.
In the US, over and above salary, payroll taxes add 7.65%, pension contributions might be up to 5%, and employer healthcare and other insurance contributions can be in the thousands, plus other benefits, equity compensation, and per-employee software licensing, and lots of people just estimate 2x salary as the “total cost” of an employee, although that probably overstates it a bit.
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