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Freelance & Outsourcing Industry: Difference between revisions
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== Freelancers VS Full Time Employees == | == Freelancers VS Full Time Employees == | ||
=== Cost Differences === | |||
According to the Small Business Administration (SBA)<ref>https://www.sba.gov/blog/how-much-does-employee-cost-you</ref>, the general rule of thumb is that the real cost of an in-house employee is typically 1.25 to 1.4 times more than an employee’s salary. <ref>https://www.upwork.com/resources/cost-of-freelancer-vs-in-house-employee</ref> | |||
{| class="wikitable" | |||
!Costs to Hire Freelancers | |||
!Costs to Hire In-House Employee | |||
|- | |||
|Hourly rate or set project fee | |||
|Salary | |||
Bonuses | |||
Health, dental, and life insurance | |||
Paid time off | |||
Retirement account matching | |||
Payroll taxes (such as Social Security, Medicare, and unemployment) | |||
Workers’ compensation | |||
Other perks | |||
|} | |||
Other Cost to Take into account, however these costs are only a 1 time expense at the onbording stage. | |||
Recruiting costs | |||
* Time of internal HR team | |||
* Time of team conducting interviews | |||
* Job board fees | |||
* Background check and drug screens | |||
Administrative costs | |||
* Time of the administrative team to enroll new employees in benefits, payroll, etc. | |||
* Fees associated with enrolling new employee in benefits programs | |||
Deferred productivity cost | |||
* Cost to productivity while new employee gets up to speed | |||
Provisioning costs | |||
* Cost of equipment necessary for employee to perform duties | |||
* Cost of new accounts for required software programs | |||
Training cost | |||
* Time of team training new employee | |||
* Cost of training programs for new employee | |||
=== Example Software Developer Cost Differences<ref>https://arc.dev/employer-blog/software-developer-freelance-vs-full-time-costs/</ref> === | === Example Software Developer Cost Differences<ref>https://arc.dev/employer-blog/software-developer-freelance-vs-full-time-costs/</ref> === | ||