Why do plumbers charge $120 to $180 per hour?

PlumbingContractor Financial Sizing

Contractor Fully Burdened Labor Rate Calculator

Calculate a trade contractor's true fully loaded hourly labor rate including payroll taxes, workers' compensation insurance, vehicle overhead, and net profit margins.

Plumbing Field StandardsContractor Financial Sizing

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Quick Summary & Key Answer

A technician paid $38/hr in base wages costs an employer roughly $48.64/hr with payroll taxes and insurance (28% labor burden). Adding $32/hr in vehicle and business overhead yields an actual cost of $80.64/hr. To achieve a 20% net profit margin, the contractor must bill $101.00 per hour.

Labor burden (taxes, insurance, PTO) typically adds 25% to 35% onto base wages.
Plumbing service trucks cost $1,500 to $2,500 per month in gas, insurance, and maintenance.
Average billable efficiency for service plumbers is roughly 4 to 5 hours per 8-hour day.

Interactive Calculator

Adjust inputs for real-time results

Base Plumber / Tech Hourly Wage$/hr

$/hr

Payroll Taxes & Benefits Burden%

FICA, Medicare, FUTA, Workers' Comp, Health Insurance, 401k.

Fixed Overhead per Tech Hour$/hr

$/hr

Service truck lease, gas, tools, office rent, software, dispatch.

Target Net Profit Margin%

Calculated OutputFully Loaded Rate Verified

Target Hourly Customer Billing Rate

$101/hr$/hour

Total Cost per Billable Hour: $80.64/hr
Burdened Direct Labor Cost: $48.64/hr
Company Overhead Allocation: $32.00/hr
Net Profit Generated per Hour: $20.16/hr (20%)

Note: Using simple markup instead of margin results in underpricing. Always calculate: Billing Rate = Total Cost ÷ (1 - Target Margin %).

Margin vs. Markup in Contracting

A 20% markup yields only 16.7% profit margin; pricing with margin ensures overhead is fully covered.

Frequently Asked Questions

Common questions regarding this calculation and code compliance

The hourly rate covers fully burdened wages, commercial insurance, vehicle leases, diagnostic tools, and warranty reserves, not just technician take-home pay.