Methodology

Markup vs margin, and pay rate vs loaded cost

Markup and margin describe the same price two different ways and are not interchangeable: a 50% markup is a 33.3% margin, not a 50% margin. Every engine that reports a markup labels which cost basis it's measured against, pay rate or fully loaded cost, because those produce different numbers from the same price. See the Markup vs Margin engine to convert between them directly.

Pay rate is what a worker is paid per hour. Loaded (or fully burdened) cost is pay rate plus employer burden, Social Security, Medicare, FUTA, SUTA, workers' compensation, benefits, and any other direct assignment cost, the number that actually determines whether a bill rate is profitable.

Staffing gross profit and economic contribution

Billings is the amount invoiced to the client. Direct worker cost is worker compensation plus directly attributable employer burden and direct assignment costs. Staffing gross profit in these engines is billings minus direct worker cost, before any program fees, funding costs, or servicing costs are subtracted.

Economic contribution goes further: it's a decision-oriented number that can additionally subtract VMS/MSP program fees, funding or factoring costs, and directly attributable servicing cost. It's built to answer "does this decision actually make money once every real cost is counted," not to match any specific GAAP presentation. Because agencies classify some costs differently (is a dedicated account manager's time a direct cost or overhead?), don't assume an engine's economic contribution will tie exactly to your own P&L; the point is that every engine uses these definitions consistently with each other, not that they replicate your accounting system.

Where default values come from

Inputs fall into three categories, and engines treat them differently:

• Stable authoritative inputs (like the 2026 employer Social Security and Medicare rates) may be prefilled, because they're sourced, dated, and the same for every agency. They're always editable and never presented as if they came from you.
• Variable benchmarks (like a typical recruiter GP or fill rate) are shown as dated, sourced context only, never silently substituted for your actual numbers.
• Agency-specific inputs (like your workers' compensation rate, SUTA rate, factoring terms, or VMS fee) are never defaulted. You have to enter them, because a fabricated default would just make an engine look populated without meaning anything.

2026 federal payroll baseline

Where an engine uses federal payroll figures, it uses the 2026 baseline: employer Social Security at 6.2% up to a $184,500 wage base, employer Medicare at 1.45% with no wage base, and FUTA at a 6.0% statutory rate on the first $7,000 per employee, reduced by a standard credit of up to 5.4% in states without a credit reduction. These figures are versioned, sourced against IRS Publication 15 and 15-A, and reviewed at least annually, not treated as permanent constants. State unemployment tax and workers' compensation vary too much by state and industry to default, so those are always your own input.

Rounding and precision

Every engine calculates in full precision internally and rounds only for display. Currency is shown to the cent where that's meaningful; long-run projections avoid implying penny-level precision they can't actually support. Percentages are stored as decimals internally and always displayed as percentages.

Recommendation and "Find the Better Move" logic

Where an engine offers a recommendation or reverse-solves a lever (like the bill rate or pay rate needed to close a margin gap), that logic is fully deterministic and shown on the page, it's arithmetic, not a hidden score. No engine uses a black-box model to produce a recommendation.

What's out of scope

These engines do not provide legal, tax, or accounting advice, employment-law interpretation, state-by-state regulatory guidance, formal credit decisions, or a formal business valuation. See the Disclaimer for the full list.