What to expect Have annual base pay, productive field hours, and employer cost rates ready. The calculation takes about a minute.

Pay and productive hours

Start with annual base pay. Add each employer expense as a percentage of that pay.

Annual base pay before overtime and bonus

$/yr

Productive hours per year

hrs

The example uses 2,080 annual hours (52 weeks x 40 hours) and about $38.33 in hourly base pay, based on BLS average hourly earnings for construction production and nonsupervisory workers in early 2026. When productive hours already account for weather and time off, enter 0% for paid time off so the calculation counts those hours once.

Employer costs as a percentage of base pay

Payroll taxesEmployer FICA is generally 7.65%, subject to applicable wage limits. Include federal and state unemployment taxes from your payroll records.

%

Health and dental insuranceEnter the employer-paid portion of annual premiums.

%

Retirement / 401k matchEnter the employer match or contribution.

%

Workers compensationUse the policy rate per $100 of payroll for the trade classification and experience modifier. Enter it as a percentage.

%

Paid time off costEnter paid days off as a percentage of 260 working days. Use 0% when paid time off is already reflected in productive hours.

%

Training, certifications, safetyInclude course fees, certifications, and safety training costs. Account for paid training time consistently with your productive hours.

%

Tools, protective equipment, and vehiclesAllocate the worker's annual share of tools, protective equipment, truck expenses, and fuel.

%

Overhead allocationInclude the worker's share of yard, office, administration, and insurance costs beyond workers compensation.

%

Full cost per productive hour

$56.90/hr

49% in additional labor costs

Base hourly pay

$38.32

Additional cost percentage

49%

Annual employer costs

$38,655

Total annual labor cost

$118,355

Each productive field hour costs an estimated $56.90, including $38.32 in base hourly pay.

Your hourly labor cost breakdown

When pricing bids, use actual payroll and benefit expenses and the workers compensation rate for each trade classification.

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Send yourself a copy of your calculation and inputs.

How the calculation works

Calculating your full hourly labor cost

Combine annual base pay with employer expenses for benefits, taxes, insurance, equipment, and overhead. Divide the total by productive field hours to calculate your hourly labor cost.

See the cost details

What affects labor burden

Your rate changes with trade classification, experience modifier, benefits, equipment, vehicles, and overhead. The example adds employer costs equal to 49% of base pay.

Where to find your figures

Find employer taxes in your payroll records, trade rates in your workers compensation policy, and benefit costs in your invoices. Use annual spending records for tools and vehicles. Allocate overhead per worker, then divide by base pay to express it as a percentage.

Apply the rate to a bid

Multiply planned field hours by your full hourly labor cost. Apply the same cost categories when comparing overtime, new hires, and subcontractors.

Use your results

Plan labor for upcoming jobs

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Compare this estimate with your records to help plan your next step.

Construction Labor Burden Calculator

Pay and productive hours

Full cost per productive hour

Your hourly labor cost breakdown

Email your results

Calculating your full hourly labor cost

What affects labor burden

Where to find your figures

Apply the rate to a bid

Plan labor for upcoming jobs

Price your next bid with full labor costs

Check your full labor rate

Keep your labor cost breakdown

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