Labor burden calculator
Put in the wage, what you pay on top of it and your overhead. Get what each hour on a job costs you.
A way to see what an hour costs once what you pay on top of wages is counted. It isn't tax, payroll or accounting advice. What you owe depends on where you work and who works for you.
Every field starts empty. The tool names no tax rate, insurance rate or benefit cost. You enter your own.
- Burdened cost per hour on jobs
- /hr
- Overhead per hour on jobs
- /hr
- Cost per hour on jobs
- /hr
- Overhead as a share of sales
- Labor and overhead on this job
An estimate from the numbers you enter. Check your own figures.
The formula usedBurdened cost per hour on jobs = (hourly rate × paid hours a year + on top of wages, a year) ÷ hours on jobs a year. Overhead per hour on jobs = overhead, a year ÷ crew hours on jobs a year. Cost per hour on jobs = the two added. Overhead as a share of sales = overhead, a year ÷ sales, a year × 100. This job = cost per hour on jobs × hours on this job.
Nothing you type here is saved. Download it if you want to keep it.
How it works out
A person costs you the wage plus what you pay on top of it, and not every paid hour is an hour on a job. So the tool adds the wage for the year to what you pay on top, then divides by the hours on jobs. Overhead per hour is your yearly overhead divided by your crew's hours on jobs. Add the two and you have what an hour on a job costs you before profit.
Example, in made-up round numbers (not a rate for any trade or place): $25 an hour for 2,000 paid hours is $50,000. Add $10,000 paid on top of wages and divide by 1,500 hours on jobs: $40 an hour. Add $30,000 of overhead over 6,000 crew hours on jobs, $5 an hour: $45 for an hour on a job, before profit.
Do it on the real job
Give each person an hourly rate in Optracs. Their hours times that rate is the labor cost on the job.
Add an Overhead & Profit line to any estimate: a percent of the other lines, in one click.
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Questions
What's labor burden?
It's what a person costs you on top of the wage, such as payroll taxes, insurance and benefits. Put in your own figures for the year.
Why divide by hours on jobs and not paid hours?
Paid hours include time off, shop time and drive time. Hours on jobs are the ones the tool divides by.
How does overhead get into my price?
On an Optracs estimate, the Overhead & Profit line is a percent of the other lines. Your overhead as a share of sales matches that percent only if your sales figure leaves out the O&P lines.
Optracs tools
Labor burden and overhead
An estimate from the numbers you enter. Check your own figures.
The formula usedBurdened cost per hour on jobs = (hourly rate × paid hours a year + on top of wages, a year) ÷ hours on jobs a year. Overhead per hour on jobs = overhead, a year ÷ crew hours on jobs a year. Cost per hour on jobs = the two added. Overhead as a share of sales = overhead, a year ÷ sales, a year × 100. This job = cost per hour on jobs × hours on this job.
Made with Optracs tools