Labor Burden Calculator
Enter your employee's hourly rate, workers' comp rate, benefits, and other costs to see exactly what they cost you per hour, per month, and per year — with a full line-item breakdown.
How This Calculator Works
Enter the employee's hourly rate, hours per week, workers' comp rate, health insurance cost, retirement match percentage, PTO days, and any other monthly costs. The calculator adds it all up.
You'll see the true cost per hour, total annual cost, burden rate as a percentage, and a full line-item breakdown of every dollar of employer burden — from payroll taxes to benefits to PTO.
Most contractors know their workers' pay rate but not their true cost. This calculator shows you the full picture so you can price jobs accurately and stop leaving money on the table.
Enter Employee Details
Typically 5–15% for construction trades
Employer portion of health insurance premiums
Uniforms, training, tools, phone, etc.
Your results will appear here
Enter employee details to see the full labor burden breakdown.
Know Your True Labor Cost
Every dollar you don't account for in labor costs is a dollar that comes out of your profit. This calculator makes sure you catch every cost.
Every Cost Itemized
See exactly where your money goes — Social Security, Medicare, FUTA, SUTA, workers' comp, health insurance, retirement match, PTO, and any other costs you have.
True Hourly Rate
Turn your base hourly wage into the real cost per hour. Most contractors are surprised to find out their $28/hr worker actually costs $38–$42/hr.
Bid Jobs Accurately
When you know your true labor cost, you can price jobs right. No more losing money because you forgot to factor in workers' comp or taxes.
Frequently Asked Questions
What is a typical labor burden rate for contractors?
Most contractors see a total labor burden rate of 25-40% on top of base wages. This includes payroll taxes (8-10%), workers' comp (5-15% depending on trade), health insurance, retirement, PTO, and other costs. Roofing and high-risk trades tend to be at the higher end due to workers' comp rates.
What costs are included in labor burden?
Labor burden includes employer-paid Social Security (6.2%), Medicare (1.45%), FUTA, SUTA, workers' compensation insurance, general liability insurance, health insurance, retirement contributions, paid time off, training, uniforms, and tools. This calculator lets you enter each cost separately for an accurate total.
How does labor burden affect my job pricing?
If you price jobs using base wages instead of burdened wages, you're underpricing every job by 25-40%. On a job with $20,000 in labor, that's $5,000-$8,000 in hidden costs you're absorbing. Always use your fully burdened labor rate when estimating job costs and building bids.
Does labor burden apply to piece rate workers?
Yes. Piece rate workers are still employees (if classified as W-2), so you owe the same employer-side payroll taxes, workers' comp, and benefits. The burden is calculated on their total piece rate earnings, not on an hourly rate. Track total earnings per pay period and apply your burden percentage.
How can I reduce my labor burden rate?
Focus on the biggest line items: improve your safety record to lower your workers' comp Experience Modification Rate (EMR), shop health insurance plans annually, and review your SUTA rate with your state. Even a 1-point drop in your EMR can save thousands per year on workers' comp premiums.
How to Pay Your Crew 20% More and Double Your Profit
The math most contractors never run — and the mistakes that cost them $93K+ a year. This free PDF breaks down the math in ten minutes. Plus, you'll understand the payroll traps that can wipe you out.
Ready to Stop Wasting Time on Payroll?
Track piece work, run payroll in minutes, and know exactly what every job costs. Free to start — no credit card required.