HOW TO USE IT
How to use the Labor Cost Calculator
- 1
Enter the number of workers assigned to the job.
- 2
Estimate the hours each worker will spend on the job.
- 3
Add the base hourly wage and your payroll burden percentage.
- 4
Review total labor cost and effective cost per labor hour.
THE MATH
Labor cost formula
Workers × hours per worker × hourly wage × (1 + burden rate)Base wages are only part of labor cost. Payroll taxes, workers’ compensation, insurance, benefits and other employee expenses may increase the amount the business must recover through its job price.
PRACTICAL EXAMPLE
Three workers on a three-day job
Three workers at 24 hours each and $28 per hour produce $2,016 in base wages. With an 18% labor burden, the estimated labor cost becomes $2,378.88, or $33.04 for each labor hour.
FAQ
Frequently asked questions
What is payroll burden?
Payroll burden is the employer cost above base wages, such as payroll taxes, workers’ compensation, insurance and employee benefits.
Should subcontractor invoices be included?
Usually no. Track subcontractor quotes as a separate direct job cost unless the workers are on your payroll.
Does this calculate overtime?
Not yet. For the current version, enter a blended hourly wage that already reflects expected overtime.
Is the result saved?
Yes. The latest entries are stored locally in this browser until you reset them or clear browser data.