Labor Rate Calculator
Labor Rate Calculator
Below you can customize the information yourself to find your own recommend labor rate.
This is the base hourly pay you give a technician before taxes or benefits. Don’t include overtime here — just their straight hourly rate. Example: If your techs make $28/hr, enter 28.
All the business costs not tied directly to wages but needed to run operations:
- Office rent, utilities, and insurance
- Vehicles (payments, fuel, maintenance, insurance)
- Phones, tablets, and software subscriptions
- Administrative salaries and management
- Marketing, uniforms, tools, and training
Enter your estimated total overhead for one year.
All the business costs not tied directly to wages but needed to run operations: office rent, utilities, insurance, vehicles, fuel and maintenance, phones and tablets, software, admin salaries and management, marketing, uniforms, tools, and training. Enter your total for one year.
Range guidance:
If you are not sure, use $30,000–$50,000 per field technician per year as a starting point.
Examples by team size:
2 techs → $60,000–$100,000
3 techs → $90,000–$150,000
4 techs → $120,000–$200,000
5 techs → $150,000–$250,000
6 techs → $180,000–$300,000
8 techs → $240,000–$400,000
10 techs → $300,000–$500,000
12 techs → $360,000–$600,000
How many field technicians you employ. This helps divide overhead across the actual workforce doing billable hours.
Not every paid hour is billed to a customer. Time gets lost to:
- Driving between jobs
- Callbacks and warranty work
- Training, meetings, and paperwork
- Job prep and downtime
- A good benchmark is 55–70%. Enter the percentage of a tech’s paid time that actually produces revenue.
How many weeks a technician is available to work each year. Standard is 48–50 weeks (subtracting holidays, vacation, and sick days).
Average weekly hours per technician. 40 is standard, but if overtime is consistent you might use 42–45.
The net profit you want to earn on labor after all costs. Many HVAC contractors target 20-35%. Enter the percent you want your hourly rate to generate in profit.