To use this calculator, input the bill rate, pay rate, burden rate, and markup. You can also specify the number of employees, average hours worked per week, and select the FUTA credit reduction rate based on the state. The calculator will provide detailed results on profit margins and costs.
The gross profit margin per hour is calculated as: Gross Profit Margin = Bill Rate - Total Cost Per Hour. Total cost per hour includes pay rate, burden rate, FUTA credit reduction, and workers comp modifier.
Suppose a staffing agency charges a bill rate of $50 per hour and pays employees $30 per hour. With a burden rate of 10% and a markup of 20%, the calculator will determine the gross profit margin and other key metrics.
When using this calculator, consider the variability in state-specific FUTA credit reductions and the impact of workers' compensation modifiers. These factors can significantly affect the total cost and profit margins.