Loaded Labor Rate Calculator

The "loaded labor rate" accounts for: payroll burden (FICA 7.65% + FUTA/SUTA + workers comp + state unemployment ≈ 18-30%), benefits (health insurance, retirement, paid time off ≈ 15-25%), overhead (vehicle, insurance, tools, supervision, office, software ≈ 20-40%), and billable efficiency (worker is paid 8 hours/day but billable for only 6-6.5 actual job-site hours ≈ 75% efficiency). A $25/hr wage becomes ~$50-60/hr loaded cost before profit.

Loaded cost × (1 + profit margin). If your loaded cost is $50/hr and you want 15% margin, billing rate = $50 / (1 - 0.15) = $58.82/hr. Note: margin vs markup are different. 15% MARKUP on $50 cost = $57.50; 15% MARGIN of selling price = $58.82. Most pros use margin (% of revenue) not markup (% of cost). Industry rule of thumb: residential GC margins 15-25%, specialty trades 20-35%, design-build 30-40%.

Markup: profit divided by cost. $100 cost + 20% markup = $120 sell price. Margin: profit divided by sell price. $120 sell price - $100 cost = $20 / $120 = 16.7% margin. So 20% markup = 16.7% margin, NOT 20% margin. This is the most common pricing mistake new contractors make - they apply 20% markup expecting 20% margin and lose 3-4 percentage points of profit per job.

Subtract from 40 paid hours: drive time between jobs, paid lunch/break, weather delays, shop time, supply runs, callbacks (rework that wasn't billed), training, paperwork. Most field employees achieve 65-78% billable efficiency. Track via project-management software (Buildertrend, Knowify, ServiceTitan) which automatically allocates hours. If efficiency drops below 65%, root causes are usually: too-distant job locations, frequent supply-runs (set up better stocking), excessive callbacks (quality control issue).