The real cost of employing a bookkeeper

As a general rule the total cost of employing a full-time staff member is around 33% more than their base wage. With this in mind, we thought we would carry out a little ‘thought exercise’ and test this rule.

Assumptions

Standard wage for a bookkeeper

According to Payscale.com the median wage for a bookkeeper in Australia is $26.28 per hour, or approximately $51,941 per year.*

As a comparison seek.com estimates that the average annual salary for a bookkeeper is $57,921 (or $29.31 per hour, based on a 38 hour work week).*

For the purposes of our illustration we will assume an hourly employee wage of $28.09 (which is half way between the two estimates).

* As of 17 July 2015

Additional costs

 

Additional costs related to employing a bookkeeper may include:

  • Leave entitlements (annual, personal, maternity, etc)
  • Superannuation (9.5% of salary)
  • Overtime
  • Performance Bonuses
  • Worker’s compensation Insurance
  • Training/Professional Development
  • HR administration
  • Overheads (computers, software, office space, phone, etc.)
  • Professional membership/registrations
  • Staff amenities (car parking, lunch room, Christmas parties, etc.)

The numbers

Based on the assumptions that we have made (see below) We calculate an actual hourly cost of $38.17 for this theoretically employed bookkeeper, which is 36.09% higher than the assumed hourly wage of $28.09.

You can download the above spreadsheet here and make your own calculations to see how much your employed bookkeeper is actually costing you.

Non-Financial Advantages and Disadvantages of employing staff

Of course, your decision to employ or contract a bookkeeper comes down to more than the financial cost. We will go through some of the possible the pros and cons of employing versus contracting a bookkeeper in the coming weeks.

 

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