Enter the total salary of the staff hire and the markup of the temp agency to determine the total amount earned by the temp agency.
Temp Agency Markup Formula
The following formula is to calculate the amount earned from a temp agency from markup.
TAM = ES * MP/100
- Where TAM is the amount earned by the temp agency ($)
- ES is the employee annual salary ($)
- MP is the temp agency markup (%)
To calculate how much markup was earned by a temp agency, multiply the employee annual salary by the markup percentage.
What is a temp agency markup?
Definition:
A temp agency markup is a measure of the percentage of an employee’s salary that a temp agency earns for finding and recruiting the employee to the company.
The typical temp agency markup is in the range of 20%-60% of annual salary, while full-time placements are charged at 10%-30% of annual salary.
How to calculate temp agency markup?
Example Problem:
The following example outlines how to calculate the temp agency markup.
First, determine the employee’s annual salary. For this example, the employee is making $50,000.00 per year.
Next, determine the percentage markup charged by the agency. In this case, the temp agency takes 30% of the salary in fees.
Finally, calculate the total amount earned from the temp agency markup using the formula above:
$ = ES * MP/100
$ = 50000 * 30/100
$ = $15,000.00
