Taplin Systems
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Cost and staffing decisions / contractor calculators

Employee vs. Subcontractor Calculator

Compare in-house employee labor with a subcontractor quote for the same scope, including productive time, supervision, setup, and a subcontractor risk allowance.

01 / Inputs

Use your own numbers

Example values or your current session inputs are loaded. Replace them with your own figures. Every field is required; enter 0 where it applies and is allowed.

Greater than 0.
Use a cost per paid hour. Payroll burden and benefits should already be included; do not enter a productive-hour rate and reduce productivity again. Minimum 0.
Greater than 0, maximum 100.
Minimum 0.
Minimum 0.
Minimum 0.
Compare matching inclusions and exclusions. Include materials on both sides consistently, or compare labor only. Minimum 0.
Minimum 0.
A planning contingency budget, not a probability forecast. Minimum 0, maximum 100.

02 / Result

Side-by-side comparison

Compare matching scope, materials, quality, and responsibility. A lower modeled cost does not determine lawful worker classification or whether subcontracting is appropriate.

Subcontractor is lower cost by

$1,861.76

USD for the same scope, not a classification recommendation

In-house employees

Total modeled cost (USD)

$11,061.76

Paid labor, setup, supervision, and other entered costs

Subcontractor

Lower cost

Total modeled cost (USD)

$9,200.00

Matching quote, coordination, and risk allowance

Employee paid hours for scope
188.24
In-house paid labor cost
$9,411.76
In-house setup cost
$250.00
In-house supervision cost
$1,000.00
Other in-house costs
$400.00
Subcontractor quote
$8,000.00
Subcontractor supervision / coordination
$800.00
Subcontractor risk allowance
$400.00

Calculate your current inputs to enable printing. Free internal job record, kept local. No document purchase required. Does not fill an Etsy template.

How the math works

Employee paid hours = baseline productive hours ÷ efficiency. In-house cost = paid hours × loaded hourly cost + setup + supervision + other in-house costs. Subcontractor cost = matching quote + coordination/supervision + quote × risk allowance %. Compare totals for the same scope.

Assumptions

A scope-cost comparison, not a worker-classification, legal, quality, or scheduling recommendation. Licensing, insurance, employment status, control of work, contracts, availability, and applicable labor rules must be assessed separately. Do not omit materials from only one side.

Planning estimate only, calculated locally in your browser. Verify costs, tax treatment, labor rules, and availability with your accountant and actual records before deciding.

Contractor field notes

Compare matching scopes before choosing a delivery approach

A subcontractor’s quote and an employee’s hourly wage are not equivalent totals. This calculator adjusts employee paid hours for productive efficiency and includes setup, supervision, and other in-house costs. It compares that total with a matching subcontractor quote plus coordination and a stated contingency allowance.

Same-scope in-house cost versus subcontractor cost

Employee paid hours = baseline productive scope hours ÷ employee efficiency. In-house cost = paid hours × loaded paid-hour cost + setup + supervision + other scope costs. Subcontractor cost = quote + coordination + quote × contingency allowance. Compare total costs, not wage versus quote.

Worked example

A scope needs 160 productive labor-hours. At 85% employee efficiency, paid time is 160 ÷ 0.85 = 188.24 hours. A $50 loaded paid-hour cost produces $9,411.76 labor cost. Add $250 setup, $1,000 supervision, and $400 other costs for $11,061.76 in-house. A matching $8,000 subcontractor quote plus $800 coordination and a 5% quote allowance of $400 totals $9,200. The subcontractor’s modeled total is $1,861.76 lower; legal classification and other business considerations remain separate.

Common estimating pitfalls

  • Compare matching materials, scope, exclusions, cleanup, warranty, and responsibilities.
  • Do not use an already adjusted productive-hour employee rate and then reduce productivity again.
  • Cost savings alone cannot establish that a worker is legally an independent subcontractor.

Frequently asked questions

Does the lower cost tell me whom to hire?

No. The model compares costs only. Quality, scheduling, licensing, insurance, availability, supervision, employment classification, and contractual responsibilities require separate assessment.

Where do materials belong?

Either compare labor-only costs on both sides or include the same material scope on both sides. Add employee-side materials to other in-house scope costs if the matching subcontractor quote includes them.

What is the subcontractor risk allowance?

It is a planning contingency applied to the quoted amount, not an estimated probability of defects or an automatic charge. Enter an allowance justified by your own scope and contract risk.