Question 1

How is electrical contractor labor burden calculated?

Accepted Answer

Electrician labor burden includes mandatory payroll taxes (7.65% FICA/Medicare, FUTA, SUTA), high-risk workers' compensation (typically 7-12% for electrical work), commercial liability insurance, health benefits, retirement matches, and non-billable training hours.

Question 2

Why is billing base wages fatal to electrical contractors?

Accepted Answer

If a journeyman earns $42/hr and you charge $65/hr thinking you make $23/hr profit, the 30% loaded labor burden ($54.60/hr actual cost) leaves you with just $10.40/hr before overhead, van wear, fuel, and callbacks.

Expense Category	Typical %	Impact on $42/hr Wage
FICA, Medicare & Payroll Taxes	7.65%	+$3.21/hr
Workers' Compensation (Electrical / High-Voltage)	8.50%	+$3.57/hr
General Liability Insurance & Bonding	4.20%	+$1.76/hr
Paid Holidays, Sick Leave & Continuing Education	5.65%	+$2.37/hr
Health & Retirement Benefits	4.00%	+$1.69/hr
Total Labor Burden	30.00%	+$12.60/hr ($54.60/hr Total)

Electrician Labor Burden Calculator

Interactive Electrical Labor Cost Estimator

Where Does the 30% Electrician Labor Burden Go?