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Question DetailsAsked on 9/28/2013

what is reasonable labor rates or a rule of thumb

we are going to have a contractor remodel our kithchen is there a rule of thumb on labor rates example 1 man 500 a day x number of days=?

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3 Answers

0
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I don't know that there is really a rule of thumb. Each business is different in what their operating costs are. My daily operating costs are pretty low comparitively but still run about $150/day. That's my break even point. Then there is the labor I pay out to the guys working which can be anywhere from $80 a day for a new unskilled laborer to $150 or even more for specialty trades. I know many parts of the country cost a lot more for labor. The infestation of illegal immigrants has driven prices down to almost unliveable wages. So if I only have a 2 man crew, with my current costs, it will cost me at a minimum $310 a day up to $450-500 a day to break even. Then I have to make something for myself.


I've told you this information to help you understand where labor rates can get fairly high quite quickly. I know some contractors who have a $600/day overhead and I have no idea how they are surviving here these days. Never pay hourly or daily for remodeling or repair work. Many handymen, and even some "con"tractors, love charging hourly because they don't have to do the legwork to figure time and materials to do a job and probably lack the experience to be able to anyway. Then they drag their feet and take way more time than necessary to get the job done so they can make more money. In the end customers often end up paying as much or more than a true professional would have cost. Get an estimate in writing. Then any changes or extra charges have to be justified due to some unforeseen problem.


Todd Shell

Todd's Home Services

San Antonio, TX

Answered 6 years ago by Todd's Home Services

0
Votes

Don't let the $80-150/day Todd was talking about mislead you - he was talking the wage he actually pays - add on the employer taxes, insurance, bonding, equipment costs, license fees, etc, etc, you are talking at least 50-100% more than that for "billable rate". And note, that like he said, Austin is one of the lowest wage rate areas of the country - places like New York City, Connecticutt, Massachussetts, etc can be 2-3 times as high. For instance, in my area daily wages run about double what he gave.

For instance, a plumbing contractor might pay his plumbers $25-30/hour in wages - with employment taxes, direct insurance like workers comp, benefits, etc that becomes $45-60/hour. Then add on the cost of the shop, trucks and fuel, several truck loads of special tools like drain cleaners and such and the truck stock of parts, inventory carrying costs, cost of capitol (interest on operating or capitalization loans), bad debt writeoff, and maybe 5-7% planned profit 9on those jobs that make a profit), you get up to a billable rate of $75-125/hour - which is what you pay the contractor, the bill-out rate.

As he said - don't be thinking labor rates unless this is a job where it is all unknown like a fire demo and rebuild - you should be thinking bid cost, and if not clearly defineable (like after a fire) break into segments each exercisable as options - once one segment is almost done (like tearout) then, when all can see the work needed for the next step (say reframing) then he gives you a bid for that phase - which you can take or go out for competitibve bids if you think he is being unfair. This approach works well with water damage and fire damage cases where you really have to do the demo to uncover the damaged areas before you can scope the structural framing rehab, which has to be at least fully scoped if not partly done before you can scope the architectural reconstruction, etc.

Mandays thinking can get you into trouble - for instance, I want to remodel my kitchen - waht is fair number of mandays for each trade ? Could range, for the tile man for instance, from 1 day for a backsplash behind a laminate or stone countertop, to 10 or more man-days for complete tile countertop, wall-height backsplash, full floor, etc. By the time you get done,, for a general contractor and all trades, a simple repaint could run a manday or maybe two, to a couple hundred or more for all trades combined for a complete tearout to studs, move some walls around, and replace.

Answered 6 years ago by LCD

0
Votes

I generally take the cost of the materials and double or triple that along with the cost of materials for my estimates it just seems fair to me

Answered 2 years ago by Davevallee226903




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