SaaS spend per employee

SaaS spend per employee, per annum, has reached its highest ever level.

As of Q3, 2025, employees cost organizations an average of $9,200 per annum in SaaS spend, compared to an average of $8,700 across the whole of 2023, and $6,900 in 2023 – a 33% increase.

This sharp rise in SaaS spend per employee is down to a perfect storm of factors:

• SaaS price increases - Software inflation has been climbing steadily over the past couple of years, reaching a Q3 2025 average of 12.5%.
• Headcount cuts - Layoffs continue to mount, with more than 90,000 tech jobs having already been cut in 2025. Despite this deduction in headcount, companies can’t immediately reduce their SaaS spend, as they are often locked into annual or multi-year contracts, typically tied to user counts.
• The proliferation of point-SaaS - Many companies have built their tech stacks with ‘point solutions’ to solve specific problems, often resulting in a costly accumulation of tools and a higher overall spend per employee.