How to calculate labor cost in construction
- True annual cost of this employee
- $75,775
- Social Security, employer share (6.2%)
- $3,720
- Medicare, employer share (1.45%)
- $870
Every figure on this page is computed from the inputs you enter, by the method stated below it. The only constants HeadcountDesk supplies are the published federal payroll tax rates and the overtime multiplier, each cited where it is used. The defaults are a worked example to replace with your own.
How to calculate labor cost in construction: the same loaded-cost arithmetic as any employer, with three construction-sized twists. The workers' compensation rate for trade class codes is a large line, not a rounding error; the divisor shrinks further because weather days, travel and mobilisation are paid hours that produce no billable work; and the crew is priced as a blended rate per productive hour for estimating. The true cost of employee calculator on this site runs the arithmetic per person, free and without an account; HeadcountDesk Pro keeps it per employee.
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The loaded cost per tradesperson
Wage, employer taxes, workers' compensation at the trade's class rate, benefits, divided by productive hours. Labor cost is the wage plus the employer's payroll taxes, workers' compensation and benefits, divided by the hours actually worked rather than the hours paid.
The construction divisor
Paid hours minus holidays and PTO, then minus weather days, travel, mobilisation and toolbox time. What is left are the hours that lay block, and they carry all the cost.
The blended crew rate
A foreman, two journeymen and a laborer priced per productive crew-hour gives the estimating number: each person's loaded hourly cost summed, divided by the crew's productive hours. Estimate with that, not with wages.
Check against the job records
The timesheets tell you what productive hours really were per job; feed them back so the divisor is measured, not hoped. Pro keeps the per-person figures. From the vendors' own pricing pages: Homebase lists Essentials at $24 per location per month billed annually or $30 monthly, with a free Basic plan for one location of up to ten employees; BambooHR lists Core at $10 and Pro at $17 per employee per month; Deputy lists Core at $6.50 per user per month. HeadcountDesk Pro is $24 a month per location.
How to calculate labor cost in construction: common questions
What is included in construction labor cost?
Wages, employer taxes, class-code workers' compensation and benefits, divided over productive hours only.
Why is construction labor cost so high per hour?
Because the divisor is small: weather, travel and mobilisation are paid hours that produce nothing billable.
Is the calculator free?
Yes, with no account. Pro keeps the loaded figure per employee.
Will it do what you need for How to calculate labor cost in construction?
Tell us what your business needs and we will tell you straight whether HeadcountDesk Pro does it today, whether it is coming, or whether you are better off with something else. A person reads these and replies.