Labor Cost Calculator

How to Calculate Labor Costs

The formula to calculate total labor costs is:

Labor Cost = (Hourly Rate × Hours Worked × Number of Workers × Days Worked) + Additional Costs

Where:

• Hourly Rate: The wage paid per hour for each worker.
• Hours Worked: The number of hours worked per day.
• Number of Workers: Total employees contributing to the project.
• Days Worked: The duration of work in days.
• Additional Costs: Any extra costs such as taxes, overtime, or supplies.

Example:

A construction project employs 5 workers who each earn $25/hour. They work 8 hours/day for 10 days. Additional costs, such as equipment rental, total $500.

Calculation:

• Hourly Rate = $25
• Workers = 5
• Hours/Day = 8
• Days = 10
• Additional Costs = $500

Using the formula:
Labor Cost = (25 × 8 × 5 × 10) + 500
Labor Cost = 10,000 + 500 = $10,500

The total labor cost for this project is $10,500.