Employee Costs

Employee Costs

Employee Costs Jonathan Poland

Employee costs refer to all of the expenses that are incurred when hiring and employing an individual. These costs go beyond just the employee’s salary and may include benefits such as healthcare, retirement plans, and other perks. In some cases, the total cost of employing an individual may be significantly higher than their salary, especially in certain industries or professions, or in countries with higher labor costs. Therefore, it is important for organizations to carefully consider all of the costs associated with hiring and employing employees when making staffing decisions. The following are common types of employee cost.

Recruiting Costs

The direct costs of recruiting an employee.

Human Resources

The cost of human resources overhead divided by the number of employees. This captures cost related to compliance and administration of employment.

Salary

Annual salary or hourly wage.

Payroll Taxes

Payroll taxes and social security payments that are paid by the employer based on the employee’s salary such as pension, unemployment insurance, medical insurance, disability insurance, maternity and child benefits. These differ greatly by nation, state or province.

Benefits

Benefits that are paid by the employer such as medical insurance, disability insurance, dental insurance, life insurance and pension.

Incentives

Incentives such as profit sharing plans, bonuses and stock options.

Paid Leave

Paid time off including public holidays, vacation, sick days, personal days, bereavement leave, maternity and paternity leave.

Training & Development

Training and development programs including the cost of onboarding.

Office Space

Costs related to office space per employee such as rent and facility management costs.

Consumables

Office consumables such as coffee, food and stationery.

Insurance

Insurance attributable to employees such as employee liability insurance.

Equipment

Furniture, fixtures and equipment such as computers and mobile phones.

Learn More
Top-down vs Bottom-up Jonathan Poland

Top-down vs Bottom-up

Top-down and bottom-up are opposing approaches to thinking, analysis, design, decision-making, strategy, management, and communication. The top-down approach begins with…

Systems Thinking Jonathan Poland

Systems Thinking

Systems thinking is the practice of analyzing the entire system, rather than just its individual parts, in order to understand…

Risk Prevention Jonathan Poland

Risk Prevention

Risk prevention is the process of identifying, assessing, and mitigating potential risks that may arise in a given situation. It…

Remarketing Jonathan Poland

Remarketing

Remarketing is a marketing strategy that involves targeting customers who have previously interacted with a business. This is often done…

Business Decisions Jonathan Poland

Business Decisions

A business decision is a commitment made by a company, team, or individual employee to a specific course of action.…

Domain Knowledge Jonathan Poland

Domain Knowledge

Domain knowledge refers to a person’s understanding, ability, and information about a specific subject or area. It is often associated…

Investor Relations Jonathan Poland

Investor Relations

Investor relations (IR) is the process of managing the relationship between a company and its investors. This includes communicating with…

What is Cultural Fit? Jonathan Poland

What is Cultural Fit?

Culture fit refers to the compatibility of a candidate’s attitudes and experiences with an organization’s culture. It is a hiring…

Workload Automation Jonathan Poland

Workload Automation

Workload automation is the process of automating the execution of routine tasks and processes in a business environment. It involves…

Content Database

Sigma Lithium Jonathan Poland

Sigma Lithium

Sigma Lithium Corporation (SGML) is a company focused on the exploration and development of lithium deposits in Brazil. The company…

Piedmont Lithium Jonathan Poland

Piedmont Lithium

Piedmont Lithium Inc., a developing company, focuses on the exploration and advancement of resource projects in the United States. The…

What is Moral Hazard? Jonathan Poland

What is Moral Hazard?

Moral hazard is a term used in economics to describe a situation in which one party has less incentive to…

Industrial Internet of Things Jonathan Poland

Industrial Internet of Things

Industrial IoT describes the ecosystem of devices, sensors, applications, and associated networking equipment that work together to collect, monitor, and analyze data across industrial operations.

What is Supply? Jonathan Poland

What is Supply?

Supply refers to the amount of a product or service that is available for purchase at a given price. In…

Needs Analysis Jonathan Poland

Needs Analysis

Needs analysis is the process of identifying the valuable requirements for a product, service, experience, process, machine, facility, or infrastructure…

Employee Retention Jonathan Poland

Employee Retention

Employee retention refers to the success of a company in keeping its talented employees from leaving. High employee turnover can…

Chief Executive Officer Jonathan Poland

Chief Executive Officer

The Chief Executive Officer (CEO) is the top administrator of an organization, responsible for its overall performance. The CEO typically…

Data Architecture Jonathan Poland

Data Architecture

Data architecture refers to the principles, structures, standards, controls, models, transformations, interfaces, and technologies that define how data is stored,…