Is your business starting to grow? Are you finding yourself in a position where you need help managing all of your tasks and projects?

You are faced with the challenges of hiring a full time employee vs virtual assistant. It's not an easy decision to make for a variety of reasons. One big one is the cost comparison of a full time employee vs a virtual assistant.

Whether you are just launching or have been in business for a while, hiring the right person can be tough. Making a poor decision can cost you a lot of time, energy and money.

Let's look at the cost comparison to help you make an informed decision about a full time employee or a virtual assistant.

What is a Virtual Assistant

It has become more common in today's cloud-based, connected world for entrepreneurs and small business owners to have at least one virtual assistant. A virtual assistant is an individual who works remotely to provide specific needs to the entrepreneur or small business owner.

It’s not a secret anymore- if you want your business to grow rapidly, outsourcing part of your workload to a virtual assistant is a smart move.

Today, virtual assistants go well beyond typical administrative secretaries. There are VA's that do admin work such as answering emails and managing your calendar, but some get much more specialized.  Among Upwork’s top-rated virtual assistants, you can find workers who are experts in Social Media Marketing, Content Writers, Video editors and even Search Engine Optimization experts.

For this reason, it's important to think outside the administrative box when it comes to what a VA can do.

Full Time Employee vs Virtual Assistant Cost Comparison

We are going to keep this simple and focus on a social media manager. On average, according to Glassdoor, a full time administrative assistant can earn $49,418. However, their actual cost to an employer is closer to $70,000. On the other hand, a virtual assistant may only cost a business owner $25,000 per year.

Why?

When hiring a full-time employee, there are other expenses you must pay in addition to their actual salary.

Hard Costs

As an employer of a full time individual, you are responsible for the following additional expenses:

• Healthcare
• Taxes
• Worker's Compensation
• Paid vacations
• Paid sick time
• Payroll costs
• Life Insurance
• Office expenses
• Office equipment

When you hire a virtual assistant, you are only responsible for paying for the actual hours worked and/or the project rate agreed upon. Virtual assistants typically provide tracking for hours they work.

Because virtual assistants work from a remote location, they provide their own equipment. In addition, they are typically considered independent contractors and cover their own taxes and expenses. Be sure to check with your accountant to verify your virtual assistant does not qualify as an employee for tax purposes.

In addition, you aren't required to fill a certain number of hours with a virtual assistant. Many VA's will only bill you for the hours they work each week. If you don't have a project or task for them, then you don't pay. (Please note, some VA's do require minimum weekly or monthly packages with a use-it-or-lose-it requirement.)

Can you afford to outsource? Use our handy calculator to find out.

If you happen to have a big project or launch coming up, then a virtual assistant can step in for a short time. This is also a great option for seasonal businesses.

Soft Costs

Then there are the soft costs of having a full time employee vs virtual assistant. The soft costs are more difficult to quantify.

• Your time spent finding, hiring, training and managing an employee.
• Water cooler time (that time employees are being paid but not working).
• Retaining employees longer than they are needed.

Training Costs

Full time employees may require a few weeks of training to get up to speed. Virtual assistants, on the other hand, are typically hired only for that specific skill set and will get up to speed much more quickly.

If an employer wants their employees to learn new skills, it is up to the employer to pay for ongoing education and training. Virtual assistants, on the other hand, understand they can increase their own value by upgrading their knowledge on their own. There's a lot more competition for virtual assistants so it is in their best interest to keep learning and growing. And they do this without cost to the employer.

Full Time vs Virtual Assistant Productivity and Efficiency

It's also not unusual for an employer to use a full time employee for tasks or projects they aren't adequately trained to do. This is a result of having someone on the payroll and needing to fill their hours. Unfortunately, this can result in a higher project cost as the employee needs to learn how to do the new task. Or worse, it can result in poor quality work that needs to be done over or leaves a bad customer impression.

Because virtual assistants are only paid on work they perform, an employer is less likely to ask them to complete tasks or projects for which the VA isn't qualified to do. This is a huge savings to the employer and allows the virtual assistant to work using their best skill set.

Water cooler time is that time when employees are away from their desks, taking breaks or just catching up on office gossip. While an employee is still on the clock for these hours, they are not getting any work done for their employer.

Virtual assistants, on the other hand, obtain their income by being highly productive and delivering value to their employers. What virtual assistants quickly realize is that their revenue depends on positive execution and efficiency, therefore, they are not lazy, and they do not prolong work.

Separate Ways

Cost isn't the only benefit to consider when hiring a full time employee vs virtual assistant. Many employers have a hard time firing someone that works for them. For this reason, a full time employee may stay on long past their usefulness. This results in significant financial losses as they continue to collect paychecks without providing value.

On the other hand, a virtual assistant is, by nature, hired on a temporary basis. While the length of the contract may vary, there is no obligation to keeping them on longer than is comfortable or useful.

What About Part Time?

You may be thinking that you wouldn't need a full time employee so these figures don't relate. It may be true that you can save much of the costs of benefits if you hire a part time vs full time employee. However, there are still the costs of taxes, equipment, etc...

In addition, there are very few highly talented individuals in your local area willing to work part time. Therefore, you may be sacrificing quality for reduced hours. On the other hand, a virtual assistant can be hired anywhere in the country or even the world. This dramatically improves the talent pool. Virtual assistants also typically work with more than one client making it possible to get a skilled worker on a part time basis. Try them out for a while and add more hours if your business needs increase!

What's Next?

We have several great articles on helping you find, hire, train, and manage your virtual team. Check some of them out here:

How to Know When Its Time to Hire a Virtual Assistant

Virtual Assistant or Online Business Manager?

How to Hire a Virtual Assistant

What to Expect When Working with a VA

Training Your VA

Tools You Need to Manage Your Virtual Teams

Final Words

There are certainly times when it makes sense to hire a full time employee vs virtual assistant. However, be sure to analyze all the pros and cons before making your decision. With the most recent expansion of virtual assistant services and skilled freelancers, it's now easier than ever to expand your business at your own pace.

If you are ready to expand your team and looking to work with a virtual assistant or two, give us a call!

Note: This article was originally published on August, 26th, 2017 and updated November 1, 2020.