Labor Burden Calculator
Calculate the true cost of an employee beyond their hourly wage. Includes payroll taxes, workers' comp, insurance, and benefits. Know your fully burdened rate before you bid.
Payroll Taxes & Insurance Rates
Benefits (Optional)
Understanding Labor Burden for Contractors
Every dollar you pay an employee costs more than a dollar. The "burden" includes mandatory costs (payroll taxes, workers' comp) and optional costs (health insurance, retirement, PTO). Most contractors underestimate this by 20-30%, which means they're losing money on every hour worked.
Typical Burden Components
| Component | Typical Rate | Notes |
|---|---|---|
| Social Security (FICA) | 6.2% | On first $168,600 of wages (2024) |
| Medicare | 1.45% | No wage cap |
| FUTA | 0.6% | On first $7,000 of wages |
| SUTA | 1-5% | Varies by state and experience rating |
| Workers' Comp | 5-15% | Varies by trade and state. Roofers pay more than painters. |
| General Liability | 2-5% | Employer's portion allocated per labor dollar |
| Health Insurance | $400-$800/mo | Per employee, employer portion |
| Retirement Match | 3-6% | If offered |
FAQ
What is labor burden?
Labor burden is the total cost of employing a worker beyond their hourly wage. It includes payroll taxes (Social Security, Medicare, FUTA, SUTA), workers' compensation insurance, general liability insurance, health benefits, retirement contributions, and paid time off. For construction workers, the burden rate is typically 25-45% on top of the base wage.
What is a typical burden rate for construction?
Most construction companies see a burden rate of 30-45% above the base wage. A $25/hour worker typically costs $33-$36/hour fully loaded. Companies offering health insurance and retirement benefits may see rates of 40-50% or higher.
Why does labor burden matter for estimating?
If you bid using the base hourly wage instead of the fully burdened rate, you're underpricing every job. On a job with 200 labor hours, underestimating by $10/hour means losing $2,000 in profit. The labor burden calculator helps you know your true cost so you price jobs correctly.
Contractor Co-Pilot builds labor burden into every estimate
Set your burdened rates once and never underbid labor again.