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A hiring calculator for small businesses that shows salary, super, payroll tax exposure, WorkCover, tools, training and revenue required.
A $70,000 employee doesn’t cost $70,000.
That number is only the headline. The real cost can include super, payroll tax exposure, WorkCover, recruitment, equipment, software, training, onboarding time, management time, leave coverage and mistakes while the person ramps up.
Hiring can be the best decision a business makes. It can also quietly break cash flow if the owner only budgets for the salary.
A $70,000 employee doesn’t cost $70,000.
That number is only the headline. The real cost can include super, payroll tax exposure, WorkCover, recruitment, equipment, software, training, onboarding time, management time, leave coverage and mistakes while the person ramps up.
Hiring can be the best decision a business makes. It can also quietly break cash flow if the owner only budgets for the salary.
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Start with the loaded cost
Loaded cost means the total annual cost of having the role in the business.
Start with wages or salary. Add super. Add expected bonus or commission. Consider WorkCover. Consider payroll tax if the business or group is over the relevant threshold. Add recruitment costs, tools, vehicle, laptop, phone, software, uniforms, training and management time.
The result is the annual cost the business must fund.
The one bit of gold
Calculate the gross profit required from the role, not just the revenue required.
If the role costs $95,000 fully loaded and the business wants a $20,000 profit contribution, the role needs to generate or protect $115,000 of gross profit.
If gross margin is 50%, that may require $230,000 of revenue. If gross margin is 70%, it may require about $164,000 of revenue. Same employee. Very different sales requirement.
Revenue alone is a bad hiring measure because it ignores margin.
Loaded cost means the total annual cost of having the role in the business.
Start with wages or salary. Add super. Add expected bonus or commission. Consider WorkCover. Consider payroll tax if the business or group is over the relevant threshold. Add recruitment costs, tools, vehicle, laptop, phone, software, uniforms, training and management time.
The result is the annual cost the business must fund.
The one bit of gold
Calculate the gross profit required from the role, not just the revenue required.
If the role costs $95,000 fully loaded and the business wants a $20,000 profit contribution, the role needs to generate or protect $115,000 of gross profit.
If gross margin is 50%, that may require $230,000 of revenue. If gross margin is 70%, it may require about $164,000 of revenue. Same employee. Very different sales requirement.
Revenue alone is a bad hiring measure because it ignores margin.
Productive hours matter
A full-time employee doesn’t produces 38 billable or productive hours every week of the year.
There is leave, public holidays, training, internal meetings, admin, downtime, supervision and rework. For service businesses, the cost per productive hour is often the number that makes the decision clear.
If the loaded cost is $95,000 and the employee has 1,380 productive hours, the cost is about $69 per productive hour before target profit. If the business sells those hours at $90 with weak utilisation, the role may not work.
A full-time employee doesn’t produces 38 billable or productive hours every week of the year.
There is leave, public holidays, training, internal meetings, admin, downtime, supervision and rework. For service businesses, the cost per productive hour is often the number that makes the decision clear.
If the loaded cost is $95,000 and the employee has 1,380 productive hours, the cost is about $69 per productive hour before target profit. If the business sells those hours at $90 with weak utilisation, the role may not work.
Check the award before you make the offer
Minimum rates, penalties, allowances, classifications and overtime can change the economics. Do not rely on a rough salary guess. Use the Fair Work tools or get advice before making an offer. We have a trusted HR partner, let me know if you’d like an introduction.
For Victorian employers, payroll tax depends on the employer or group's total Australian wage position, not just one employee. That means the same hire may have different tax consequences in different businesses.
Hiring is not just affordability
Even if the business can afford the person, ask:
Is there enough work to use them well?
Is there enough management capacity to train them?
Are systems documented?
What will they own by day 30, 60 and 90?
What number proves the hire is working?
What happens if revenue is delayed?
A hire without a clear success measure becomes a cost looking for a job.
Minimum rates, penalties, allowances, classifications and overtime can change the economics. Do not rely on a rough salary guess. Use the Fair Work tools or get advice before making an offer. We have a trusted HR partner, let me know if you’d like an introduction.
For Victorian employers, payroll tax depends on the employer or group's total Australian wage position, not just one employee. That means the same hire may have different tax consequences in different businesses.
Hiring is not just affordability
Even if the business can afford the person, ask:
Is there enough work to use them well?
Is there enough management capacity to train them?
Are systems documented?
What will they own by day 30, 60 and 90?
What number proves the hire is working?
What happens if revenue is delayed?
A hire without a clear success measure becomes a cost looking for a job.
What to do this week
What to do this week
Download the True Cost of Hire Calculator. Enter the salary you are considering. Then enter realistic productive hours and gross margin. If the revenue required surprises you, that’s good. Better to be surprised in a spreadsheet than in payroll week, give me a call and let’s chat about the results.
Sources and useful links
Website disclaimer note: This article provides general information only and does not take into account your circumstances. It is not a substitute for tax, legal, financial, employment, cyber security or other professional advice.
Download the True Cost of Hire Calculator. Enter the salary you are considering. Then enter realistic productive hours and gross margin. If the revenue required surprises you, that’s good. Better to be surprised in a spreadsheet than in payroll week, give me a call and let’s chat about the results.
Sources and useful links
Website disclaimer note: This article provides general information only and does not take into account your circumstances. It is not a substitute for tax, legal, financial, employment, cyber security or other professional advice.
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Got questions?Maybe it’s time for a macchiato with Chris.
Got questions?
Maybe it’s time for a
macchiato with Chris.
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self-made journey?
© 2026 Denari Advisory. Liability limited by a Scheme approved under Professional Standards Legislation.
Strategy and Site by Touching Base
Ready to kick-start your self-made journey?
© 2026 Denari Advisory. Liability limited by a Scheme approved under Professional Standards Legislation.
Strategy and Site by Touching Base
Ready to kick-start your
self-made journey?
© 2026 Denari Advisory. Liability limited by a Scheme approved under Professional Standards Legislation.
Strategy and Site by Touching Base
