Re: RDi vs SEU

In most service industries, from appliances to electronics to car repairs to barber shops and everything in between, any billing rate below 3 times the labor cost will end in going out of business. Most ratios are 5 to 1. The idea that the cost of a programmer is less than 2 times his wages has no basis in realty.

On 4/4/2015 12:31 AM, John Yeung wrote:

On Fri, Apr 3, 2015 at 5:01 PM, Jon Paris <jon.paris@xxxxxxxxxxxxxx> wrote:

Most people figure that the actual cost of an employee runs
somewhere between 40 and 100% of their actual salary. So
someone who makes $50K a year would actually cost between
$70 and $100K.

I was wondering about your "$100K including overheads". I guess this
explains it, sort of. I mean, part of your explanation is backwards,
but I guess the gist is: The salary is only a part of the total cost
of a programmer; there are also "overheads" (presumably to pay for the
space they take up, the energy they use, maintenance on their
equipment, etc.). So the salary would be somewhere between 40% and
100% of their total cost. Or, to turn it around, the total cost would
be between 100% and 250% of their salary.

So someone who makes $50K per year is, at your estimate, costing their
employer somewhere between $50K and $125K per year.

John Y.