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Comment by haburka | Hacker News Reader

Considering that the effective salary of 1 person/mo would be around ~15k, I think spending $200 to make people more efficient is absolutely worth it

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Sir, where do you pay $15k for a startup developer salary?!

Depending on jurisdiction, there are taxes and such on top of salary.

I've always heard that, for the US, when thinking about salary you want to about double what the employee makes when considering the employers cost.

This might apply to large organizations with lots of overheads and perks. But it definitely does not apply to startups.

This is overkill, add 35% to the top and you will be closer (depending on absence/sick levels).

Statutory allowances in the UK are higher than in the US, and in the UK for instance you would add:

- 12.5% national insurance + apprentice levy

- 3-4% pension

- 10% of days as holidays

- 5% of days as sick / other leave (dependent on amount taken in reality)

- 2% payroll fees / other

Note, this excludes training and equipment/office space.

Why add holidays and sick leave to an individual employee's costs? Most white collar employees would have an annual salary this is factored into already, unless you're having to hire temporary replacements for them perhaps (which would be more than a 15% cost, I suspect).

You are right, I usually do this to get to a worked daily or worked hourly cost (I work in consultancy) so I take holidays & sick into account to understand cost per worked hour / cost per worked day.

In reality it depends on the type of work you are doing.

Ah! Definitely makes sense in consulting/contracting :-)

I guess it depends when there you consider other costs like office space, equipment, utility bills, HR overheads, consumables etc.

That metric isn't just about actual payroll expenses, but also things like office space, janitorial services, etc.

Health insurance is another big one in the states.

In NL it's about 35%. Doubt other countries vary that much, probably a lot in the 25-40% range.

He said per month.

Actually there is a more important comparison than salary: what benefit accrues to the company for 1 employee month.

When a company is undergoing fast growth, the return from one month of work can be startlingly huge. Every tool that enables better use of time is a multiplier on the income generated by that employee.

Also note, “sir” seems snarky to me at best and insulting at worst. Are you even answering a guy?

15k could be cost to the company, which also looks at employment taxes, office space, health insurance, benefits, hr/support overhead, interviewing, training and managing. A new developer earning 8k/mo easily costs the company 15k/mo.

The person at ~15k/month (which is a really good salary) wouldn't only be doing that. I maintain a lot of tools that would cost 1000x if we paid subscriptions per user @ SaaS and it probably takes me 1-2 days per month. We're at ~150 devs.

I do a lot of other work in the other days of the month including coding, automation, leading, etc. etc.

The company is Italian, 15k/mo is VEEERY far from the local reality (more likely 40k/year)

15 k / month? Lol. Perhaps in a very tech dense specific area in the US and then you have the rest of the world.

The problem comes when services start effectively 10x'ing or 100x'ing prices, like what postman did at the beginning of this year (bumping up the price for each tier and dramatically reducing what you get)

That $200/mo today could easily be $200K/mo a few years from now, and at that point it will be harder to switch off.

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