Labor rate

The price per hour of labor a shop charges, as printed on the estimate and, where a state requires it, posted at the counter. A shop may carry more than one: a default, a rate for a customer or a fleet, a rate for a canned job, a rate by the vehicle's make or class.

The labor rate on the door is a price. It is what multiplies the hours on an estimate line, and the number a customer compares between shops.

Behind the door rate a shop usually keeps several, and a system that holds only one forces the others into discounts. The common ones: a default rate; a rate for a fleet or a named customer; a rate for a canned job, where the job carries its own price rather than hours times rate; a rate by the vehicle's make or class; and a diagnostic rate. Each is a named rate with its own figure, so an invoice can say which one applied.

The posted rate is a price; the rate the shop actually earns per hour is a result, and the two only agree when every clock hour is billed at the posted rate with no discount. That result is the effective labor rate, and the gap between the two is where unbilled diagnosis, discounts and comebacks show up.

Labor charge on a line = billed hours × the named rate that applies to the line

There is no benchmark on this page. State averages published by vendors are their own customers' data, and the only rate that matters to a shop's arithmetic is its own. Work yours out from your costs and your billed hours with the labor rate calculator.

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