Temp vs Direct Hire Calculator
Compare a staffing agency's hourly bill with the full cost of an employee, and find the week when hiring wins.
Defaults are examples: replace them with your quote and costs. It ignores turnover, training time and any conversion fee. Your inputs stay in this browser.
When Is Direct Hire Cheaper Than a Temp?
Direct hire becomes cheaper once the weekly savings from no markup have repaid the one-time hiring cost. Divide the hiring fee and other one-time costs by the weekly difference between the temp bill and the employee's full cost. If the role lasts longer than that many weeks, hiring is usually the cheaper route.
Temp vs Hire Questions
Is a temp cheaper than hiring an employee?
Per hour, a temp usually costs more; over a short period it can cost less, because you avoid the hiring fee and benefits. The longer the role lasts, the more direct hire tends to win. This calculator finds that crossover using your numbers.
What is included in the cost of an employee?
Base pay, plus payroll taxes, workers' compensation, insurance, paid time off and other benefits. Use your own figure in the "extra cost" field; it differs a lot by company.
How much is a direct-hire recruiting fee?
As a rule of thumb, often about 15% to 25% of first-year pay, with senior searches sometimes higher. Enter 0 if you will hire without a recruiter, and add your own ad and interview costs in the one-time field.