What does it cost to hire an employee in the UK?

A UK employer pays about £45,129 a year to employ someone full-time on the national median salary, once employer National Insurance and the minimum pension contribution are added, and about £47,129 in the first year with the cost of recruiting them. ONS figures for April 2025 put the median salary for full-time employees who had been in their jobs for at least a year at £39,039. For a full-time employee on the National Living Wage, on a 37.5-hour week, the same sum comes to about £28,309. National Insurance and pension add about 14% to a minimum-wage salary and about 16% to a median one, before sick pay, insurance, equipment and the weeks a new person spends learning the job.

What does an employer pay on top of salary?

The rates below are GOV.UK's for the 2026 to 2027 tax year, which runs from 6 April 2026 to 5 April 2027.

• Employer National Insurance. 15% of each employee's earnings above the secondary threshold of £5,000 a year. On the median salary that is £5,106. The employee's own National Insurance is deducted from their pay and costs the employer nothing extra. An eligible employer can claim the Employment Allowance, which takes up to £10,500 a year off its bill: enough to cover two employees on the median salary. A company whose sole director is its only employee cannot claim it.

• Pension. From the day the first employee starts, an employer must provide a workplace pension, enrol staff aged 22 to State Pension age who earn at least £10,000 a year and normally work in the UK, and pay in at least 3% of their qualifying earnings, which in most schemes are the pay between £6,240 and £50,270 a year. On the median salary that is £984.

• Holiday. Almost every worker is entitled to 5.6 weeks' paid holiday a year, at least 28 days for a five-day week, and the employer may count bank holidays within it. The pay is already in the salary. The cost comes when the work cannot wait and someone has to cover it.

• Sick pay. Statutory Sick Pay is £123.25 a week, or 80% of the employee's average weekly earnings if that is lower, for up to 28 weeks. For 2026 to 2027 it is due from the first day of illness, and the employer cannot recover it.

• Employers' liability insurance. For most employers it is compulsory from the day they become one, for cover of at least £5 million from an authorised insurer. An employer without it can be fined £2,500 for every day.

How much does it cost to recruit a member of staff?

The CIPD's Resourcing and talent planning report 2026 puts the median cost of a hire at £2,000 for employees below senior management and £3,500 for senior managers and directors. The figure for other employees has risen from £1,500 in the CIPD's 2024 survey. It is meant to include advertising, a LinkedIn licence, agency or search fees, selection tests, vetting, onboarding and the time your own people spend on it. The CIPD warns that the samples are small, 223 employers for the £2,000 figure, and that costs vary widely between sectors, so treat it as a marker rather than a quote.

Two worked examples

The sum for a salary between £6,240 and £50,270 is short, and adds 15% of the pay above £5,000 and 3% of the pay above £6,240.

• The median full-time salary, £39,039: employer National Insurance £5,106 and pension £984 make £45,129 a year, or £47,129 in the first year with the CIPD's recruitment median.

• The National Living Wage, £12.71 an hour from April 2026 for workers aged 21 and over. On a 37.5-hour week for 52 weeks that is £24,785 a year; employer National Insurance £2,968 and pension £556 make £28,309, or £30,309 in the first year.

The ONS figure is for April 2025 and for people who had been in their job for at least a year, and the 2026 survey has not yet been published. A new starter's pay in your area, from your own adverts, is the better check before you set a budget.

What the sum leaves out

None of these figures includes the laptop and the software seats, a desk, training, cover for holiday and sickness, a company sick pay scheme or a pension above the minimum. Nor does it count the manager's hours in the first months, while the new person learns your customers, your systems and the way your business does things.

What it costs to hire for a particular job

Our articles on single jobs run the same sum on the pay for that job:

• an administrator, an office manager, a receptionist or a personal assistant;

• a bookkeeper, an accounts assistant or a credit controller;

• a legal secretary, a paralegal or a paraplanner;

• a lettings administrator, a recruitment administrator, a sales administrator or a service desk analyst.

Can AI do part of the job instead?

Look for the part of an admin job that is the same work every day: keying orders, chasing documents, sending reminders, logging replies and keeping records up to date. An AI worker can take that part. It is given one written job, is scoped to work in the systems you already run, and has a person who approves its work. The phone calls, the judgement, and every decision about a person or about money stay with your people.

Before you advertise, write down a week of the job you are about to fill and mark what repeats. Our comparison of AI staff with hiring an administrator sets the two side by side. An AI worker has a cost of its own, and our starting price is on the homepage.

In an admin post an AI worker would take the keying, chasing and reminders that repeat every day, and the calls, the judgement and every decision about staff or money would stay with your people. Is the post you are about to fund at £45,129 a year mostly the same tasks each week? Talk to our agent first.