Labor burden calculator for construction hourly rates

The “Employer contributions on gross wage” line is the statutory federal and state employer payroll tax and nothing else. FICA is 7.65 percent — Social Security 6.20 on the first $184,500 of 2026 wages and Medicare 1.45 with no ceiling — and it is the only part charged on the whole wage. Both unemployment taxes run on a capped taxable wage base, which makes their headline rates misleading: federal unemployment tax is 6.0 percent on the first $7,000 with a 5.4 point credit where the state is compliant, so $42 a year, which is 0.06 percent of a $73,400 wage and not 0.6. State unemployment tax is carried at 1.0 point. The Department of Labor puts the 2025 all-industry average at 1.74 percent of taxable wages and 0.39 percent of total wages, and a residential builder sits well above that because seasonal layoffs push the experience rating up: New York charges 1.7 to 9.5 percent in 2026 and construction accounts cluster near the top of that band, which on New York's low wage base is about 1.0 to 1.4 percent of gross. The “Work accident insurance on gross wage” line is workers' compensation alone. It is the one cover an employer must carry by law in every state except Texas, it is quoted per $100 of payroll against a class code, and residential framing is NCCI class 5645, Carpentry — Detached One or Two-Family Dwellings, hazard group E. The 7.5 is a mid manual rate: the New York Compensation Insurance Rating Board publishes a loss cost of 4.961 per $100 for class 5645 with effect from 1 October 2025, which a carrier turns into a manual rate near 6 to 7 once expenses are loaded; Florida and Michigan approved rates for the same code sat at 7.69 and 7.10; and Washington charges $4.6938 per hour worked for risk class 0510, wood frame building construction, which on a $35 wage is about 13 percent of payroll shared between employer and worker. The “Holiday and sector funds” line is zero. The United States has no construction holiday, bad-weather or training fund of the BUAK or CIBTP kind, and paid vacation and holidays are an ordinary employer benefit that already sits inside “Paid hours per year”. General liability, commercial auto and umbrella cover are freely priced market policies and not statutory, so they sit in “Other employer costs per year” and not here.

Almost every figure here is a state figure. The state unemployment tax alone runs from 0.02 percent of total wages in Arizona to 1.47 in Nevada across all industries, and the taxable wage base it sits on goes from $7,000 in California, Florida and Texas to $72,800 in Washington, so the same 3 percent experience rate is worth $210 in one state and $2,180 in another. Workers' compensation for class 5645 spreads at least as far, roughly $3 to $14 per $100 of payroll, and the manual rate is only the starting point: an experience modification and schedule credits commonly take a clean residential account 15 to 30 percent below manual, while a firm with claims pays above it, and Texas does not require the cover at all. On the hours side, 2,080 is the standard full-time year of 40 hours over 52 weeks, and the industry average is lower: the Bureau of Labor Statistics reports 37.1 paid hours a week for production and nonsupervisory employees in residential building construction as the 2025 annual average, which is 1,929 hours a year once weather days, short weeks and part-time crews are averaged in. The 364 unproductive hours assume eight paid holidays, ten vacation days, five sick or personal days and 180 hours of shop, yard, inter-site travel, punch list and weather standby; a builder who pays no vacation loses those 80 hours from “Paid hours per year” as well, so the billable total barely moves. The “Other employer costs per year” line carries only about $1,900 of health insurance because the Medical Expenditure Panel Survey finds just 26.8 percent of employees at firms under 50 enrolled in a plan; a builder that does offer single coverage pays about $6,900 for that one employee and the burdened rate rises by roughly three dollars an hour.

The figures were researched for 2026 and are starting points, not your payroll: replace any of them with the numbers from your own records.