What labor rate means
The labor rate is what you charge per hour of work, built from labor cost, burden, overhead and profit.
Also called hourly rate, shop rate.
Where it shows up in your business
Your rate is a business number, not a guess based on what others charge. Work it out once a year from your real costs and billable hours, and raise it when they rise.
Work it out
- Free calculator: Labor rate calculator
- Money guide: Flat rate vs time and materials
- Money: Money guides for contractors