Direct employee
Modeled total over selected horizon
- Recurring cash over horizon
- One-off cash
- Cash total
- Valued internal time
- Average modeled total per month
Plan the cost
Engineering hiring budget worksheet
Compare the same role, capacity and time period before comparing prices. Enter your own salary or supplier quote, included costs and management time. This worksheet keeps cash spending separate from the value of internal time.
What the worksheet counts
This worksheet compares direct employment with an external engineer using assumptions you enter. It separates cash from the internal time you choose to value, then totals each over the same headcount and time horizon.
Direct employment uses annual salary divided by 12, plus your salary-linked on-cost percentage and other monthly cash. The external option uses a monthly quote plus other monthly cash. Both options can include one-off cash, monthly manager hours and onboarding hours.
| Measure | Formula | What it means |
|---|---|---|
| Recurring cash each month | Primary pay + other monthly cash | For an employee, primary pay includes the entered on-cost percentage. For an external engineer, it is the monthly quote. |
| Cash over the horizon | Headcount × (months × recurring cash + one-off cash) | One-off costs stay separate from recurring monthly cash. |
| Valued internal time | Headcount × manager-hour value × (months × monthly manager hours + onboarding hours) | This is an optional value for your team’s time, shown apart from cash. |
| Modeled total | Cash over the horizon + valued internal time | A result from the assumptions below, not a recommendation or guaranteed saving. |
Blank means unknown, not zero. Enter 0 when a cost or hour amount does not apply. If an external quote already includes a cost, enter 0 for that item to avoid counting it twice. Currency changes the labels only; the worksheet never converts amounts.
Enter your assumptions
All fields start blank. The example button is optional and clearly identified; reset clears the worksheet. Values stay in this browser page and are not submitted or saved.
Optional planning notes are for your own context. They do not change the arithmetic, price either option, or claim the scopes are equivalent. No automatic price is generated.
Choose one currency for every money field. No conversion is performed.
Whole number from 1 to 36.
Whole number from 1 to 50.
Your planning assumption for internal time.
Compare modeled totals
Complete every assumption with a valid value to see totals. Blank means unknown, not zero.
Planning context (not used in the math)
- Shared outcome and deadline
- Not entered
- Employee capacity, start date and inclusions
- Not entered
- External capacity, start date and inclusions
- Not entered
- Unresolved differences
- Not entered
All amounts below are in selected currency. Selecting a currency changes labels only; it does not convert any input.
Totals for people over months.
External engineer
Modeled total over selected horizon
- Recurring cash over horizon
- One-off cash
- Cash total
- Valued internal time
- Average modeled total per month
0
- Recurring cash
- One-off cash
- Valued internal time
Average per month includes one-off cash divided across the selected horizon for this average only. The separate one-off line shows it is not recurring cash. The difference describes these assumptions; it does not recommend an option or guarantee a saving.
Worked example
This static example uses one person for 12 months and USD solely to show the arithmetic. It is not a market quote or recommended budget. The same values appear only if you choose “Load illustrative example.”
| Input or result | Direct employee | External engineer |
|---|---|---|
| Primary pay | $120,000 annual salary | $14,000 monthly quote |
| Salary on-cost | 25% | Not applied to the external quote |
| Other monthly cash per person | $500 | $800 |
| One-off cash per person | $3,000 | $700 |
| Manager hours per month; onboarding hours | 4; 24 | 2; 12 |
| Shared manager-hour value | $100 | |
| Recurring cash per month | $120,000 ÷ 12 × (1 + 25%) + $500 = $13,000 | $14,000 + $800 = $14,800 |
| Recurring cash over 12 months | 12 × $13,000 = $156,000 | 12 × $14,800 = $177,600 |
| One-off cash | $3,000 | $700 |
| Valued internal time | $100 × (12 × 4 + 24) = $7,200 | $100 × (12 × 2 + 12) = $3,600 |
| Modeled total | $156,000 + $3,000 + $7,200 = $166,200 | $177,600 + $700 + $3,600 = $181,900 |
| Average modeled total per month | $166,200 ÷ 12 = $13,850 | $181,900 ÷ 12 = $15,158.33 |
With these inputs, the external model is $15,700 higher over the horizon. That difference is entirely conditional on the example inputs. It does not account for different deliverables, availability, leave, contract terms or outcomes.
Test a 10% pay change
The worksheet varies only primary pay: annual salary for direct employment or monthly quote for an external engineer. It holds every other input fixed, including headcount, horizon, on-cost, setup costs and time. These are arithmetic scenarios, not a confidence interval.
| Option | 10% lower | Entered pay | 10% higher |
|---|---|---|---|
| Direct employee | |||
| External engineer |
When assumptions are incomplete, these cells stay blank with the totals. The scenarios show how sensitive this arithmetic is to the pay assumption, not the chance that a quote or salary will change.
Make the options comparable
Before comparing totals, write down what each amount buys and who owns the work. A lower number for a narrower or shorter commitment does not price the same plan.
Match the scope and time
- List the deliverables, acceptance checks and who handles production support.
- Compare the same start date, end date, expected availability and weekly hours.
- Include leave, holidays, notice periods, ramp-up and handover time where they affect capacity.
- Use the same headcount and horizon; change one assumption at a time when exploring alternatives.
- Separate management, review and onboarding time from cash so its value is visible.
Check what the quote includes
- Mark which equipment, software, expenses and other recurring costs are already included.
- Identify recruiting, setup, transition and termination costs as one-off items.
- Check whether the quoted amount has minimum hours, a notice period or a fixed commitment.
- Do not count an included cost twice. Enter 0 for the matching extra-cost field.
- Keep tax, legal classification, benefits obligations and supplier terms for qualified review.
Scope and limits
This is a local planning worksheet for comparing user-entered assumptions. It does not estimate taxes, legal obligations, agency pricing, exchange rates, productivity, delivery quality or the value of a particular candidate. The external option is a monthly quote entered by you, not a supplied market rate.
Use whole months and headcounts. Enter 0 only when a cost is included elsewhere or does not apply; leave unknown costs blank until you can confirm them. Field messages explain any value outside the supported range.
Use a single currency throughout. Results are arithmetic summaries of the values you supply, not a supplier recommendation or guaranteed saving. The page does not store or send the values.