AILOS← All decision modelers

Decision Architecture / 01

Pro

Hire, contract, or AI-augment?

The true 12-month cost of each path — loaded salary with ramp, fully-billed contractor, and AI-augment netted against hours saved.

About this tool

About the Hiring Decision Framework

The hiring decision has changed. Five years ago the question was hire vs. contract. Today it's hire vs. contract vs. AI-augment — and the math is rarely intuitive. This calculator gives you the loaded 12-month cost of each path: full-time salary plus benefits, taxes, and overhead; contractor at fully-billed rate including ramp; and AI-augmentation netted against the hours your existing team gets back. The output isn't a single answer — it's three defensible numbers side by side, plus a one-page brief that explains the assumptions so your finance partner, your hiring manager, or your board can interrogate the logic instead of the verdict. Use it before opening a req, before extending a contractor, or before approving an enterprise AI license that promises 'one fewer hire.'

When to use it

  • Before posting a new req to confirm full-time is the right path
  • Renewing or expanding a contractor engagement
  • Justifying an AI tool that claims to replace headcount
  • Reorg or zero-based-headcount planning at the team level
  • Defending a hiring freeze with concrete alternatives

Frequently asked

How do you calculate the true cost of a full-time hire?+

Loaded salary = base × (1 + benefits load + employer tax + overhead). Default load is ~1.4×, adjustable. Then we add ramp cost (productivity gap in months 1–3) and tool stack cost per seat.

How is AI-augment cost calculated?+

AI-augment cost = (tool cost × seats) − (hours saved × loaded labor rate × 52 × adoption rate). It can go negative — which is when AI-augment beats both hiring paths.

When does hiring still win?+

When the work needs sustained context, judgment, accountability, or relationships that AI cannot hold. The calculator flags this as a 'context premium' that AI-augment can't capture.

Can I use this for engineering hires specifically?+

Yes. The default loaded labor rate is calibrated for knowledge work; set it to your engineering-team rate and the math holds. AI-augment factor is most aggressive for engineering today.

Related tools

Your numbers

Pro modeler

Read the framing free. Run the numbers on Pro.

Inputs are locked on the Free plan. Upgrade to run every modeler with your own numbers.

Upgrade to Pro →

Sample numbers shown. Upgrade to Pro to edit and save your own.

Recommended path

-$27,217

Over 12 months, ai-augment is the cheapest path — by about $227.3K vs the most expensive option.

AI-augment wins by $227.3K over 12 months

Key numbers

Hire (12-mo, loaded)$175,500
Contract (12-mo)$200,046
AI-augment (12-mo net)-$27,217
AI breakeven vs hire< 1 mo

What to do next

  1. 01

    Pick the tool + a single owner before any rollout work.

    Owner · Team lead
  2. 02

    Block 4 hrs/wk on the owner's calendar for prompt + workflow upkeep.

    Owner · Team lead
  3. 03

    Set a 90-day review: did the team actually capture the hours saved?

    Owner · Team lead

Save this scenario

Create a free account to name, save, and revisit this run from your dashboard.

Save it →

Plain-English read

Baseline read

A full-time hire runs about $175.5K all-in over the first 12 months — base salary plus 30% benefits load, with a 3-month productivity ramp baked in.

Contracting at $110/hr for 35 hours a week costs roughly $200K for the same coverage — no ramp, but no equity either.

AI-augmenting your existing team nets to -$27.2K once you account for 10 hrs/wk saved at $95/hr loaded labor, minus tool cost and 4 hrs/wk of management overhead.

The math favors AI-augment — but only if your team has the literacy to actually capture those hours. Pair this with a verification practice or you'll burn the savings on rework.

Share this decision

  • Hire: $175.5K all-in (salary + 30% benefits + 3-mo ramp).
  • Contract: $200K for 35 hrs/wk @ $110/hr.
  • AI-augment: -$27.2K net (saves 10 hrs/wk × $95, minus tools + mgmt overhead).
  • Recommendation: AI-augment.