Labor Burden Calculator (2026)
An employee costs more than their hourly wage. This works out what you really pay per hour once payroll taxes, workers' comp and benefits are added, so you can price jobs on the real number.
Calculator
Social Security, Medicare and FUTA use the 2026 federal rates. Everything else is yours to fill in: your state unemployment agency sends your SUTA rate, and your insurer or policy shows your workers' comp rate.
How to use it
- Wage and paid hours: the employee's hourly pay and every hour you pay them for in a year, including paid time off.
- SUTA rate and wage base: from your state unemployment tax notice. Rates differ by state and by employer, so there's no default. Leave the wage base blank to apply the rate to all wages.
- Workers' comp: your rate for this worker's job class, entered as a percent of wages. If your policy quotes a rate per $100 of payroll, that number is already a percent.
- Benefits: what you pay a year for things like health insurance, retirement match, uniforms or a phone.
- Billable hours: the hours you can charge customers for. Fill it in to see the cost per billable hour.
2026 federal payroll tax figures used
- Social Security: 6.2% employer share on wages up to $184,500 a year.
- Medicare: 1.45% employer share on all wages, with no cap. The extra 0.9% Additional Medicare Tax is withheld from the employee only, so it isn't part of your cost.
- FUTA: 0.6% on the first $7,000 of each employee's wages, so at most $42 per employee a year. That assumes you get the full credit for paying state unemployment tax on time.
FUTA credit reduction: employers in some states pay extra FUTA when their state owes federal loans. The 2026 list isn't final until after November 10, 2026, so this calculator does not add any credit reduction. Check the IRS or your state's notice after that date.
Labor burden is the total of those costs on top of wages. Divide it by wages to get the burden percentage. Use the true cost per hour in the contractor hourly rate calculator or the job costing calculator, then price jobs on a contractor quote template.
Questions
Why are SUTA and workers' comp blank?
They change by state, by employer and by job type, so any default would be wrong for most people. Use the numbers from your own state notice and insurance policy.
Does this include federal income tax withholding?
No. Income tax you withhold is the employee's money, not an extra cost to you.
Is anything I type saved or sent?
No. The math runs in your browser and nothing is uploaded.
Templates and calculators are for general use only and are not legal, tax or accounting advice. Tax figures are the 2026 federal rates and can change; check with the IRS, your state or your accountant.