The True Cost of a Local Hire in 2026
Market Intelligence · 7 min read · Updated 2026-07
The true cost of a local hire in 2026 is roughly 1.4–1.7x base salary once you load employer taxes, benefits, recruitment, equipment, software, floor space and management overhead. Budgeting on salary alone is the most expensive accounting shortcut in mid-market business — and it's why offshore comparisons look so favourable when done fully-loaded.
The full cost stack
Base salary is only around two-thirds of the real number. Add superannuation or employer taxes, payroll tax, workers' comp, recruitment amortisation, equipment, software seats, floor space, management overhead and the cost of a bad hire, and the true figure lands between 1.4x and 1.7x salary.
What changes offshore
Offshore employment doesn't remove these costs — it consolidates them into one monthly rate. That's why the honest comparison is fully-loaded local versus fully-managed offshore, and why it typically shows a 60–70% saving.
Key takeaways
- True local cost ≈ 1.4–1.7x base salary.
- Salary is only ~two-thirds of the real number.
- Offshore consolidates costs into one rate.
- Always compare fully-loaded to fully-managed.
Common questions
Is there a tool to model this?
Yes — our True Cost of Hire Model spreadsheet on the Resources page loads the real on-costs so you can compare local versus offshore for your own numbers.
Your next hire doesn't have to cost six figures.
Book a 30-minute strategy session. You'll leave with a costed workforce plan, indicative salaries and a realistic timeline — whether you work with us or not.