Calculate labor cost per unit of work
Divide the combined hourly labor cost of the crew by the quantity that crew completes per hour. The FHWA Western Federal Lands Estimating Handbook, section 3.3, uses labor classifications, hourly costs, production rates, and quantities to build the labor component of a cost estimate.
Crew cost per hour = sum of each role’s hourly labor cost × the number of workers in that role.
Labor cost per unit = crew cost per hour ÷ units completed per crew-hour.
Enter hourly employment cost on the same hour basis used for production. If you start with base wages, use the fully burdened labor rate calculator to build an hourly cost for each role. Once those inputs include burden, carry them into the crew calculation as entered.
Calculate crew labor cost
The starting values are illustrative. Replace them with your estimate inputs.
Worked example: cost per linear foot
Assume one lead installer costs $48 per productive hour and two installers cost $36 each per productive hour. The crew installs 30 linear feet per productive crew-hour. All figures are illustrative USD assumptions for the method.
- One hour of the crew costs $48 + 2 × $36 = $120. That elapsed crew-hour contains three individual labor-hours.
- Labor cost is $120 ÷ 30 = $4.00 per linear foot. The labor consumption is 3 ÷ 30 = 0.10 individual labor-hours per linear foot.
- For 240 linear feet, allow 240 ÷ 30 = 8 crew-hours, or 24 individual labor-hours, at a total labor cost of $960.
If production falls to 24 linear feet per crew-hour, labor rises to $5.00 per linear foot at the same crew cost. Materials, equipment, overhead, and profit are separate estimate components under the cost build-up described by FHWA.
Use production measured on the same basis
Use the actual crew mix and define when the clock starts and stops. For example, convert a shift measurement to an hourly rate using the hours that match the cost basis, and document how setup or downtime is handled. The FHWA guide to construction contract time recommends field records and accounting for site constraints when choosing production rates. Use your own relevant job records when available.
This calculator assumes both roles work for the same crew-hour. If roles work different durations, multiply each role’s hourly cost by its own hours, add those labor costs, and divide by the quantity completed. Continue with a unit price analysis example to see how labor fits into a wider estimate. That separate example is based on a Mexican project context.