Compare the full cost of AI tools versus human staff for any task or function. See true employment cost including employer NI, pension and management overhead against AI tool equivalent.
This calculator shows economic cost comparison. In practice, AI typically augments human work rather than replacing entire roles. Automating 60% of a role's tasks frees the person for higher-value work — not necessarily elimination. Staff replacement decisions involve legal, ethical, cultural and practical factors beyond cost calculation. Always seek HR and legal guidance for any restructuring decisions.
The salary on a job advert represents approximately 60-70% of the true cost of employment. Add employer National Insurance (13.8% above £5,000), employer pension (3%+), holiday pay, sick pay, HR overhead, IT, premises, management time and recruitment cost amortised — the true cost of a £28,000 employee is approximately £40,000-£45,000. This is the number to compare against AI tool costs.
| Cost Component | £28,000 Employee | £45,000 Employee | £70,000 Employee |
|---|---|---|---|
| Gross Salary | £28,000 | £45,000 | £70,000 |
| Employer NI (13.8% above £5k) | £3,176 | £5,521 | £9,001 |
| Employer Pension (3% min.) | £840 | £1,350 | £2,100 |
| Overhead (25%: HR, IT, space) | £8,004 | £12,968 | £20,275 |
| True Annual Cost | £40,020 | £64,839 | £101,376 |
| Effective Hourly Rate (32 prod.hrs) | £24/hr | £39/hr | £61/hr |
True employment cost = Salary + Employer NI (13.8% above £5,000 secondary threshold) + Employer pension (minimum 3%) + Overhead (25-40% for HR, IT, premises, management time, training, recruitment amortised). A £28,000 salary employee typically costs £38,000-£45,000 total. A £45,000 employee: £58,000-£70,000 total. Always use total employment cost, not salary, when comparing against AI or outsourcing alternatives.
AI can handle specific, well-defined tasks but rarely entire roles — which involve judgment, relationship management, physical presence and context-switching that current AI handles poorly. The more accurate frame is "AI handles routine tasks, freeing people for higher-value work." Wholesale replacement of knowledge workers with AI is technically possible for narrow functions but often impractical due to quality requirements, accountability, customer expectations and the need for human oversight of AI outputs.