Free Calculator

Free labor rate calculator for service businesses

Enter your true tech costs and desired profit to see the minimum billable rate per hour to break even and the recommended rate at your target margin. No signup, no data stored, runs entirely in your browser.

Your numbers — results update as you type

Tech Wages

$

The tech's base pay for the year — the starting point before anything else.

%

Employer FICA (7.65%), FUTA/SUTA, and workers comp added on top of wages. 22% is a solid default.

$

Health, dental, PTO cash-out, and any other per-tech spending per month.

Billable Hours

27.0 billable hours/week on average

Hours you can actually invoice — not hours worked. Typical field tech: 1,200 to 1,500 after drive time.

Vehicle and Equipment (per tech per year)

$
$
$
Vehicle subtotal $9,600

Overhead Allocated Per Tech (annually)

$
$
$
$
Overhead subtotal $6,000

Target

%

The percentage of gross revenue you keep after all costs. 20% is a healthy target for most trades.

Your labor rate

Break-even rate
$52/hr
Minimum to cover all costs — no profit
Recommended rate
Break-even + your target margin
Wages + burden $63,440
Benefits (annual) $4,800
Vehicle + equipment $9,600
Overhead $6,000
Total annual cost $83,840
At $65/hr for 1,400 billable hours, you bring in $91,000 and keep $7,160 after all costs.
Wages+burden 76%
Benefits 6%
Vehicle 11%
Overhead 7%

What a labor rate calculation should include

Most service businesses undercharge because they calculate labor rate from wages alone. A complete rate captures every dollar the tech's work must recover before the business earns a cent of profit.

Know what every job actually costs with Claver

Claver tracks actual hours, materials, and drive time against the quoted price on every job. When the labor rate this calculator produces is in the system, Claver can show real-time whether each tech is billing at or above break-even, flag jobs that are trending over budget, and surface which service types consistently run at margin versus which ones quietly erode it.

Start free — no credit card

Starter plan is $19/mo flat for up to 2 users.

Labor rate calculator — FAQ

How do I calculate my labor rate for a service business?
Add the technician's annual wage to payroll burden, benefits, vehicle costs, and overhead allocation, then divide by billable hours per year to get the break-even rate. Add your target margin on top of that to get the rate you should charge customers.
Is this calculator really free?
Yes, the labor rate calculator is free with no signup, no credit card, and no data stored on a server, so the wage and cost numbers stay on the device.
How many billable hours should I use in my calculation?
Most field technicians generate 1,200 to 1,500 billable hours per year after accounting for drive time, callbacks, training, and non-billable admin. Using 1,400 is a reasonable starting point; adjust down if your techs spend significant time driving between stops.