Monthly cost layers and client-price boundaryPer assigned employee
Business
Staffing Pricing Calculator
Convert pay into a complete staffing-service price by separating wage, payroll burden, monthly benefits, operating overhead, paid hours, billable utilization, and target gross margin. Review the break-even rate, client rate, monthly gross profit, and utilization sensitivity before quoting.
Recommended client bill rate-
Break-even bill rate-
Loaded cost per paid hour-
Billable hours per employee-
Monthly client price per employee-
Gross profit per employee-
Total assignment revenue-
Cost markup equivalent-
Monthly employment cost recovered through billable hours
Cost-to-price anatomy
Build the bill rate without confusing margin and markup
Loaded employment costTarget gross profit
| Pricing case | Utilization | Target margin | Break-even rate | Client bill rate | Monthly gross profit |
|---|
How to use the Staffing Pricing Calculator
- Enter the employee's paid hourly wage and ordinary paid monthly hours.
- Add wage-linked payroll burden separately from fixed benefits, operating overhead, and recruiting recovery.
- Use billable utilization to convert paid hours into the hours that can actually be invoiced.
- Enter the target gross margin as a share of client price, not a markup on cost.
- Review the break-even rate before the recommended price, then test the named sensitivity cases.
Staffing price fundamentals
What a defensible bill rate can include
A staffing price must recover more than the employee's wage. This model separates each cost layer so a quote can be reconciled to the underlying assignment economics.
Included in the displayed price: entered wage, burden, benefits, overhead, recruiting recovery, billable utilization, and target gross margin.
Calculation method
How the staffing bill rate is calculated
Monthly cost is accumulated first. Billable hours are paid hours multiplied by utilization. Dividing cost by billable hours gives the break-even hourly rate; solving the margin equation produces the client rate.
C = wH(1 + b) + B + O + RLoaded productive-hour cost c = C ÷ (Hu); client bill rate q = c ÷ (1 − m).
Margin = (q − c) ÷ qEquivalent markup on cost = m ÷ (1 − m). A 25% margin therefore equals a 33.33% markup.
- w
- Base wage in currency/paid hour.
- H
- Paid hours per employee/month.
- b
- Payroll burden as a decimal share of wage.
- B, O, R
- Monthly benefits, overhead, and recruiting recovery.
- u
- Billable utilization as a decimal.
- m
- Target gross margin as a decimal share of price.
Utilization reality
Price the hours you can invoice
Paying 173.33 hours does not guarantee 173.33 billable hours. Holidays, onboarding, bench time, internal training, client closures, and unapproved time reduce the recovery base.
- Use contract evidence, not an aspirational utilization rate.
- Price guaranteed pay even when a client cannot be billed.
- Revisit the rate when assignment length changes recruiting-cost recovery.
Quote risk
Items that may need separate pricing
Overtime, shift differentials, bonuses, paid travel, background checks, equipment, conversion fees, bad-debt exposure, and jurisdiction-specific taxes can change assignment economics.
- State whether the bill rate changes with overtime.
- Match currency and period across every input.
- Align payment terms with working-capital capacity.
Pricing comparison
Break-even rate versus target-margin rate
The break-even rate only recovers modeled cost. The target-margin rate adds profit as a percentage of the client price. Quoting between them produces a positive but below-target margin; quoting below break-even loses money under the entered utilization.
Below break-evenModeled lossAbove targetMargin protected
Worked example
Your staffing price, step by step
Price reconciliation appears here.
Scope and limitations
What this staffing price does not include
- Overtime, shift differentials, bonuses, or commissions
- Sales tax, VAT, or jurisdiction-specific staffing levies
- Financing cost from client payment terms or bad debt
- Contract guarantees, rebates, conversion fees, or credits
- One-time equipment, travel, screening, or credential costs unless entered in overhead
- Income tax or accounting treatment of the resulting margin
Key terminology
Staffing pricing glossary
- Bill rate
- Client price per approved billable hour.
- Billable utilization
- Billable hours divided by paid hours.
- Gross margin
- Gross profit divided by client revenue.
- Markup
- Gross profit divided by modeled cost.
- Payroll burden
- Employer cost that scales with direct wage.
- Loaded cost
- Direct wage plus the modeled employer and operating cost layers.
Important note
This calculator is a pricing model, not a binding client quote or accounting opinion. Confirm employment law, payroll taxes, insurance, assignment terms, overtime rules, payment timing, taxes, and all contract-specific costs before issuing a rate.
Staffing Pricing Calculator FAQ
Why does lower utilization raise the bill rate?
The same monthly cost must be recovered from fewer approved billable hours.
Can I enter a zero target margin?
Yes. The recommended rate then equals the break-even rate, which leaves no modeled gross-profit protection.
Where should workers compensation go?
If it scales with payroll, include it in burden. If it is a fixed allocation per employee, include it in overhead.
Should recruiting cost be charged forever?
No. Estimate a defensible recovery period and update the monthly amortization if the expected assignment length changes.
Why is margin different from markup?
They use different denominators: margin uses selling price, while markup uses cost.