MAKE EVERY BILLABLE HOUR COUNT
Find your sustainable labor rate.
Calculate a billable contractor labor rate from wages, payroll burden, paid hours, billable time, overhead, and target margin. Free, with transparent assumptions.
01Team & employment costs
Overhead excludes the technician wages and burden entered here. Billable share excludes leave, driving, training, and other paid time you cannot bill.
HOW IT WORKS
Labor rate calculator
A billable labor rate needs to cover more than an hourly wage. This calculator divides annual technician payroll and allocated overhead by expected billable hours, then applies your target margin. It accounts for paid time that cannot be billed to a customer.
- 01Enter a representative technician's wage, payroll burden, and annual paid hours.
- 02Estimate the percentage of those paid hours that can actually be billed, excluding paid leave, driving, training, and other unbilled time.
- 03Enter the number of technicians and annual overhead for that team, excluding the technician payroll already entered.
- 04Review break-even cost, the suggested billable rate, and the cost of an example job's labor hours.
A WORKED EXAMPLE
An hourly-rate example with paid downtime
At an illustrative $30 hourly wage, 25% payroll burden, and 2,080 paid hours, annual payroll cost is $78,000 per technician. At 65% billable time, there are 1,352 billable hours. If $120,000 of annual overhead is allocated equally across three technicians, break-even cost is $87.28 per billable hour. A 30% target margin gives a rate of $124.68 before tax and discounts.
Questions, answered.
What is labor burden?
Labor burden is the employment cost added to wages, such as employer payroll taxes, benefits, and applicable insurance. Enter the percentage that reflects your own records. Do not include the same cost in both burden and overhead.
Why is the billable rate higher than the wage?
Revenue from billable hours must also fund employer costs, paid nonbillable time, and allocated overhead. A technician paid for 2,080 hours but billing only 1,352 hours has fewer revenue-producing hours available to recover those costs.
How is overhead divided between technicians?
This model allocates the annual team overhead equally across the technician count you enter. It assumes the same wages, paid hours, and billable share for each technician. Run separate scenarios when roles or cost structures differ materially.
Can I use the result in an estimate?
Yes. Open the labor planner inside the estimate builder to use its fully allocated cost per billable hour. Confirm replacement of existing wage lines and allocated overhead before applying it. The builder applies the job's pricing method once; it does not mark up a labor selling rate again.
Is this a recommended market labor rate?
No. It is a planning rate calculated from your inputs. It does not predict customer demand, competitive pricing, actual utilization, or realized profit. Compare the model with your payroll, job records, and overhead and update assumptions as those change.
WHEN THE JOB MOVES FORWARD
Keep your customers, work, and follow-up together.
Explore how CrewBrix connects the next steps. Your free-tool draft stays in your browser; it is not automatically imported into an account.