Payroll Raise Scenario Comparator
Compare alternative compensation budgets.
Payroll Raise Scenario Comparator: Scenario Inputs
Annual percentage rate or benchmark index change.
Inflation & Purchasing Power Analysis
Over 3 years at 3.5% inflation, a $75,000 salary requires $83,154 to retain equal purchasing power. Without matching raises, your real compensation experiences an effective reduction of $7,355 (-9.81%).
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How Payroll Raise Scenario Comparator Works?
The Payroll Raise Scenario Comparator works by applying each raise budget to total payroll and adding the employer burden.
Enter payroll totals
Type annual base payroll and headcount.
Enter employer burden
Type payroll taxes and pay-linked benefits as a percentage of pay.
Define scenarios
Enter 2 to 5 raise budgets and expected inflation.
Compare costs
The output shows added cost, cost per employee and real raise per scenario.
Payroll Raise Scenario Comparator Formula
The Payroll Raise Scenario formula multiplies payroll by the raise budget and by one plus the employer burden.
Added Cost = Payroll × Raise Budget × (1 + Burden)
Real Raise = (1 + Raise Budget) ÷ (1 + π) − 1
Variables
- Payroll
- Annual base pay for all staff
- Burden
- Employer taxes and benefits linked to pay
- π
- Expected inflation
Worked example
A 4% raise budget on a $4,800,000 payroll with a 22% burden adds $234,240 per year, or $3,660 per employee across 64 staff.
Payroll Raise Scenario Comparator Conversion Table
This table compares 5 raise budgets for a $4,800,000 payroll, 64 employees and a 22% burden, against 3.5% inflation.
| Raise budget | Added base pay | Added total cost | Cost per employee | Real raise at 3.5% |
|---|---|---|---|---|
| 2.5% | $120,000 | $146,400 | $2,288 | -0.97% |
| 3.0% | $144,000 | $175,680 | $2,745 | -0.48% |
| 3.5% | $168,000 | $204,960 | $3,203 | +0.00% |
| 4.0% | $192,000 | $234,240 | $3,660 | +0.48% |
| 5.0% | $240,000 | $292,800 | $4,575 | +1.45% |
What is Payroll Raise Scenario Comparator?
The Payroll Raise Scenario Comparator is a tool that compares the cost of alternative raise budgets across a full payroll, including employer taxes and benefits tied to pay. Each scenario shows the added cost and the average raise per employee.
The comparator lets finance and HR teams test a 3%, 4% or 5% budget against inflation before committing.
What are the uses of Payroll Raise Scenario Comparator?
There are 4 main uses of the Payroll Raise Scenario Comparator.
Set the raise budget
Choose a budget that fits finances and protects real pay.
Present options to leaders
Show executives the cost and staff effect of each option.
Include hidden costs
Add employer taxes and pension contributions to raise costs.
Plan headcount trade-offs
Compare raise budgets with hiring plans.
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