Earlier quoted context omitted.
> The finding that most surprised me was that the mean salary for an engineer without a college degree is only $3k (~2%) less than for those with one; this gap is much smaller than in the labor market as a whole. The sample set of people using TripleByte is not going to be remotely representative of the market for developers as a whole. Candidates with stronger resumes are not going to be using third party recruiters…
This! We are a small team of 5 expecting to double in 2019, all from experienced folks extracted from big companies. We budgeted $260 each and our investors didn't bat an eye.
Let's take a $150k base salary as a specific example, as a nice round-ish number. The numbers from Triplebyte don't include bonuses and equity; I suspect that 20% combined is a reasonable assumption. That puts us at 180k.
Now we have employer costs that the employee never sees (this all assumes the US):
* Social security: $8.2k (6.2% of $132,900 in 2019). * Medicare: $2.6k (1.45% of 180000) * State payroll taxes (for things like unemployment insurance): ~$1.5k in California, say, mostly for State Disability Insurance bits.
We're up to $193k.
Health insurance for employees, if you provide it, is probably $10k-$30k depending on the health plan and whether the employees have families. So $203k-$223k. Equipment is a few thousand per year. Office space (if local) or possibly travel (if remote, though maybe you could try to do everything async or over videoconference), really depends on the geography.
At that size, I don't know whether you have 401(k) matching or safe harbor contributions, but if you do that's presumably another $5k-$15k depending on how generous the match is.
So a base salary of $150k means a budget of at least $205k and more likely closer to $230k or $240k.