How to Build a Loaded Labor Rate

The hourly rate in a quote is not the wage you pay. It is the wage plus everything an hour on the tools actually costs the business: payroll taxes, insurance, vehicle, tools, downtime between jobs, and the unbillable hours that every billable hour has to carry.

How to build a loaded rate

A sample walkthrough with sample numbers: a $30 wage, plus roughly 15% for payroll taxes ($4.50), insurance and vehicle costs spread per billable hour (say $8), tools and consumables (say $3), and the drag of unbillable time; if only 6 of 8 paid hours are billable, divide the running total by 0.75. That sample builds to about $60 per billable hour before any profit at all. Your real numbers will differ, which is exactly why you should run them.

Then quote with it

Put the loaded rate into the labor line of the calculator and let profit be its own separate decision on the subtotal, where you can see it.

The calculator asserts no wage or rate data. The samples above are arithmetic demonstrations, labeled as samples, not market figures.

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The template pack

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