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Action Toolkit
Playbook 15The Wage Is Two-Thirds of the Answer

Decide Whether to Hire

Before a job advert: what a person really costs, how many jobs a month you now need, and whether the work is actually there.

What you end up holding

“A number-backed yes or no, instead of hiring out of exhaustion and finding out in month three.”

The workflow — 4 steps

  1. 1

    Calculate the fully loaded cost — wage plus FICA, unemployment tax, workers' comp and benefits.

    Typically 1.25-1.4× the wage. A $20/hr hire is a $26/hr decision.

    Open What an Employee Really Costs →
  2. 2

    Recalculate your break-even with payroll in it.

    Payroll is fixed and work is not. That gap ends more growing trade businesses than slow months do.

    Open Break-Even Calculator →
  3. 3

    Check whether your lead flow can actually feed another pair of hands.

    Hiring into a thin pipeline turns a busy problem into a payroll problem.

    Open Cost Per Lead & Per Job →
  4. 4

    Settle employee versus contractor in writing before anyone starts.

    The tests turn on control. Misclassification is back taxes, penalties, and an uninsured injury claim.

The evidence

Satisficing Under Exhaustion

“Decision makers can satisfice either by finding optimum solutions for a simplified world, or by finding satisfactory solutions for a more realistic world.”

— Herbert Simon, bounded rationality

Owners hire when tired, which is precisely when the search is shortest and the criteria loosest. Doing the arithmetic in advance converts an exhausted judgement call into a threshold you either clear or you don't.

The older idea

Counting the Cost

“Suppose one of you wants to build a tower. Won't you first sit down and estimate the cost to see if you have enough money to complete it?”

— Luke 14:28

The passage is about half-built towers, which is what an unaffordable hire produces — someone let go at three months, worse off than before, and a business that now trusts its own judgement less.

Go deeper on this

A playbook ends in a document. These journeys change what you can do — same subject, more of it.