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Can you actually afford the next hire?

The math owners get wrong: a $60K salary doesn't cost you $60K. It costs you closer to $80K — and you have to keep paying it during the months they're learning. Here's the real number, and the monthly revenue lift you need to make it work.

The numbers

Best-guess inputs are fine — the point is the magnitude.

$
Just the base. Don't add payroll taxes or benefits — the math does that for you.
%
Revenue minus direct costs (materials, fuel, labor on jobs), as a % of revenue. Home-services average sits around 50–60% — pest is higher, GC is lower.
months
How many months until they're contributing the full revenue lift you're hiring them to drive. CSRs/admin: 1–2. Techs: 2–4. Sales: 3–6.
%
Employer FICA + unemployment + comp + benefits, as a % on top of salary. Most home-services businesses land at 20–30%.
The verdict
Reasonable lift
A $60K hire actually costs you:
$ 75,000 / year
To sustain that, you need to add at least $11,400 in monthly revenue (assuming your 55% gross margin holds on the new work). They pay for themselves at 14 months — accounting for the 3-month ramp before they're at full output.
Loaded cost / month
$6,250salary + burden, every month
Cost during ramp
$18,750paid in full while still ramping
Monthly rev lift to sustain
$11,400at your gross margin
First-year true cost
$75,000including ramp drag
Sanity-check this with Frank

Free 30-min call. I'll pressure-test the math against your actual numbers and tell you whether the hire makes sense now or in 6 months.

The math: Loaded annual cost = salary × (1 + burden). Monthly revenue lift needed = (loaded cost ÷ 12) ÷ gross margin. Payback = ramp months + (loaded cost ÷ (monthly rev × margin)). Conservative by design — doesn't account for productivity gains the hire frees up in others, which often shorten payback in real life.
What to do with this number

If the lift seems impossible, the hire is too early.

Most "I can't afford to hire" problems are actually pricing problems, capacity problems, or follow-up-discipline problems. Fixing one of those usually unlocks the hire — without raising a dollar.

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Three numbers every home-services owner should know cold

Cash runway, gross margin by job type, and what's recurring out the door. If you can't answer these, you're hiring blind.

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What's your time actually worth? Sometimes the answer is: "your time taken off the schedule is worth more than the hire." Run the math.

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Two-way check

Hire or hold? Let's sanity-check the math.

Bring me your real numbers on a free 30-min call. I'll tell you whether the hire pencils — or whether there's a faster, cheaper fix to the problem you're trying to hire away.

Book a free call