Outsourcing vs in-house hiring cost calculator
Compare what a team costs on your payroll, including employer costs, recruiting and equipment, with a vendor's monthly rate.
Estimate
- In-house total for the period
- €166,000
- Vendor total for the period
- €156,000
- Difference (in-house minus vendor)
- €10,000
- In-house cost per person per month
- €6,917
How we calculate
- In-house per person: salary × (1 + employer costs) × years, plus recruiting cost × salary once, plus equipment × years.
- Vendor: monthly rate × months × people. The rate is taken as all-in.
- The difference is in-house minus vendor. A positive number means the vendor costs less for this period.
- Not included: time to hire, ramp-up, management time and notice periods. They usually favour the vendor for short periods and in-house for long ones.
Assumptions
| Assumption | Value | Why this value | Source |
|---|---|---|---|
| Employer costs on top of salary | 20 % of salary | Social contributions, insurance and benefits. Set low on purpose; across the EU it is often higher, so this understates in-house cost. | Eurostat labour cost statistics (non-wage share of labour costs), low endEurostat dataset lc_lci_lev (labour cost levels)Eurostat Statistics Explained: wages and labour costs |
| Recruiting cost per hire | 15 % of annual salary, once per hire | Agency fees or the internal time and job ads it replaces. Agencies commonly charge 15 to 25 %. | Typical recruitment agency fee range, low endSHRM: working with search firms (contingency fees) |
| Equipment and software | 2,000 EUR / person / year | A laptop spread over three years plus basic licences. Office space is left out. | TOC estimate |
Want to check these numbers against your setup?
Bring the estimate to a call. We will go through the assumptions with your real figures.