Your $25/Hour Technician Costs More Than $25: Calculate Your True Labor Rate
Stop estimating from payroll alone. Find out what each billable hour truly costs your pressure washing or soft washing business—and what you need to charge to stay profitable.
A contractor tells you, “I pay my technicians $25 an hour, so labor on a four-hour job with two employees costs $200.”
The multiplication is right. The estimate is incomplete.
That $25 wage doesn't include the employer's share of payroll taxes, workers' compensation, unemployment insurance, benefits, paid downtime, trucks, or the hours you pay for but cannot bill a customer.
At Wash Works Supply, we're focused on helping exterior-cleaning contractors build stronger businesses—not just better washing rigs. Here's a practical way to put a real number on your labor cost.
Calculate your true labor rate
Enter your actual wages, employer payroll expenses, insurance, benefits, overhead, nonbillable time, and target profit margin.
The calculator will show your direct employee cost per paid hour, your cost per billable hour, your fully burdened cost after overhead, and the recommended selling rate for your desired margin.
No email address is required.
Why a $25/hour technician can cost $34.50—or more
Consider this illustrative breakdown:
Expense | Per paid hour |
Base wage | $25.00 |
Employer taxes and workers' compensation | $4.25 |
Benefits, PPE, uniforms, and other costs | $5.25 |
Total direct labor cost | $34.50 |
These are example costs, not universal payroll or insurance rates.
For a two-person crew working four hours, that's eight technician-hours.
At $25 per hour, your assumed labor expense is $200.
At $34.50 per hour, your direct labor expense becomes $276.
That's $76 in additional costs you may have overlooked on a single job.
And that doesn't yet account for business overhead, profit, or paid hours that cannot be invoiced.
The difference between paid hours and billable hours
A full-time technician might be paid for 2,080 hours a year, but how many of those hours produce billable revenue?
Consider driving between jobs, loading equipment, training, weather delays, repairs, paid holidays, and vacation.
If your direct employee cost is $34.50 per paid hour and only 70% of paid time is billable, your labor cost per billable hour becomes:
$34.50 ÷ 0.70 = $49.29 per billable hour.
The same employee now costs nearly $50 for every hour you can actually sell.
This is why efficient routing, reliable equipment, well-built washing rigs, and well-trained crews matter so much to profitability.
Don't forget your overhead
Your company also pays for trucks, trailers, equipment, fuel, vehicle insurance, office employees, rent, marketing, software, and maintenance.
Those expenses need to be covered by the revenue your technicians generate.
Allocate your overhead across your available billable technician-hours without counting the same expense twice.
Understand your target profit margin
A 25% markup is not the same as a 25% profit margin.
If your fully burdened labor cost is $60 per billable hour, adding 25% gives you a $75 selling price—but that is only a 20% margin.
To achieve a 25% margin, the calculation is:
$60 ÷ (1 − 0.25) = $80 per billable hour.
The interactive calculator does this math automatically.
A 15-minute labor pricing audit
Review your last 90 days of payroll and determine your average technician wage.
Confirm your actual employer payroll taxes, workers' compensation, and employee benefit expenses.
Compare paid technician-hours against the hours you actually billed customers.
Allocate your recurring business overhead across your productive field capacity.
Enter everything into the calculator and review your last three estimates.
Were those jobs really as profitable as you believed?
Build a business that's profitable—not just busy
A full schedule doesn't necessarily mean a healthy business.
Understanding the difference between what you pay, what labor costs, and what you need to charge can change how you price every job.
Better scheduling, equipment reliability, crew efficiency, and accurate estimating can help you keep more of the revenue you work hard to earn.
Wash Works Supply — Built by washers for washers.
Our goal is to help contractors build better equipment, stronger systems, and more profitable businesses.
This calculator is an educational estimating tool. Actual labor costs, tax rates, insurance expenses, and profit margins depend on your business and should be verified against your records.
Comments