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A November 6 analysis from Thorsten Meyer AI calculates that a median-paid U.S. software developer costs an employer about $95 per hour actually worked, before recruiting costs, using cited BLS figures. It argues that the choice between staff augmentation and hiring depends on the outside specialist’s rate, how much work the employee can do, and the value of retaining expertise. The supplied source does not provide a complete Germany-versus-U.S. comparison or market rates for augmentation.
Thorsten Meyer AI published a cost analysis on November 6 examining when a business might spend less by hiring a full-time software developer or using staff augmentation. Its U.S. calculation puts the employer cost of a median-paid developer at about $95 per hour actually worked, before recruiting costs, and says the comparison turns on an outside specialist’s quoted rate and the employee’s effective utilization.
The U.S. estimate combines a $135,980 median annual wage for software developers, reported by the Bureau of Labor Statistics for May 2025, with an employer-cost multiplier of about 1.28. The article derives that multiplier from BLS June 2026 compensation data for “management, professional, and related” occupations: $78.88 in total employer costs per hour worked against $61.43 in wages and paid leave. It estimates about 1,830 hours actually worked from 2,080 annual paid hours, then divides the approximate $174,600 annual employer cost by those hours.
The analysis cites different measures for Germany. Destatis reported €29 in non-wage labor costs per €100 of gross pay in 2025. It also reported an average employer cost of €58.50 per hour worked in the information and communication sector. The article cautions that the sector figure covers all jobs, not only software developers, so it is not a directly equivalent developer-specific estimate.
Recruiting is presented as a smaller addition in the example: the article cites SHRM’s 2025 average cost per hire of $5,475 for non-executive roles, which it says adds about $3 per hour when spread across one year of work. It says a 50% utilization assumption could raise the example break-even rate from about $98 to about $197 an hour, but the supplied material does not show the full calculation behind those figures.
Compare the real cost of developer work
Full-time hiring and staff augmentation depend on the cost of useful work, the outside rate, and how much capacity the employee can use.
How Utilization Changes the Cost
The comparison is useful because a salary alone does not show what an employer pays for an hour of productive work. Benefits, paid leave and recruiting add costs, while unused capacity can make each hour of completed work more expensive. The article’s central decision measure is a break-even hourly rate: compare an outside specialist’s quote with the cost of the work a full-time employee can actually perform.
That measure can inform budgets for projects with changing workloads. The analysis says augmentation may suit short, uncertain or specialist assignments, while hiring may make more sense for ongoing core work that keeps an employee busy or depends on knowledge the company wants to retain. These are general decision factors, not a finding that one model is always cheaper.
Its AI discussion makes a similar distinction. The article says evidence on how much faster coding agents make developers remains unsettled. It argues that AI may change the inputs to the calculation by creating specialist projects and increasing the value of retaining internal knowledge; it does not establish a measured productivity gain.
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The Inputs Behind the Estimate
The analysis uses public labor statistics and says it found no published staff-augmentation rate survey with a clear method. It therefore gives readers a calculation to use with actual quotes, rather than presenting provider prices as a market benchmark. The U.S. wage and employer-cost figures also come from different reporting periods: the wage is for May 2025, while the employer-cost data is for June 2026.
The figures are estimates, not a universal price list. The U.S. employer-cost multiplier is based on a broad professional occupational group rather than software developers alone. The German hourly-cost figure covers the information and communication sector, while the non-wage cost measure is expressed relative to gross pay. Differences in populations and measurement mean the two countries’ headline figures should not be treated as a like-for-like developer comparison.
The source identifies the article as created with AI assistance and says its narration uses an AI voice clone of Thorsten Meyer. It also carries an affiliate disclosure and says the material is not legal, tax or financial advice.
“A salary is not the cost.”
— Thorsten Meyer AI article
Rates and Workload Remain Unknown
The source does not provide staff-augmentation market rates, provider quotes or a documented rate survey, so it cannot show which option is cheaper for a specific company. The break-even result depends on the quote, role, project length, employee utilization and the assumptions used to calculate employer costs.
The article’s supplied text ends during its Germany discussion and does not include a complete German developer-cost calculation. Its U.S. estimate also applies a professional-group employer-cost ratio to the software developer median wage, rather than using a developer-specific total compensation figure. The precise impact of AI on developer output is described as unsettled, with no productivity estimate supplied.
Apply the Formula to Quotes
The next step for a business weighing the options is to gather its own specialist quotes and hiring assumptions, then compare them on the same basis: cost per hour of useful work. That calculation should account for employer costs, paid time away, recruiting and the share of a full-time employee’s available time devoted to the project.
The source identifies no scheduled follow-up, new dataset or next publication date. The decision remains specific to each role and workload; the cited figures provide inputs and examples, not a universal verdict.
Key Questions
What hourly cost does the article estimate for a U.S. software developer?
It estimates about $95 per hour actually worked, based on a $135,980 median wage for May 2025, an employer-cost multiplier of about 1.28 and roughly 1,830 hours worked annually. It is a calculation, not a quoted hiring rate.
Does the analysis prove that staff augmentation is cheaper?
No. It provides no market rate for staff augmentation. A company would need to compare its own specialist quote with the estimated cost of hiring and the amount of productive work available.
What does the article report for Germany?
It cites Destatis figures of €29 in non-wage labor costs per €100 of gross pay in 2025 and €58.50 average employer cost per hour worked in the information and communication sector. The hourly figure covers all jobs in that sector, not developers alone.
How does utilization affect the comparison?
When a full-time employee has less project work, the cost per useful hour rises. The article gives a 50% utilization example in which its break-even rate rises from about $98 to about $197 an hour; the supplied material does not include the detailed calculation.
What does the source say about AI and developer productivity?
It says evidence on how much faster coding agents make developers remains unsettled. The article identifies possible effects on specialist project demand and internal knowledge retention but gives no measured productivity gain.
Source: Thorsten Meyer AI
