What to charge for electrical work
Nobody teaches this part. You learn the trade for years, then one day you are the one who has to put a number on a piece of paper — and the number you pick is usually the one the last guy you worked for used.
This page does not tell you what to charge. Anyone who gives you a national number is guessing — rates move with your market, your licence class, your overhead, and whether you are a one-truck operation or running four crews.
What it does is give you the method: what has to be inside the number, why the number most electricians pick is short, and how to build a rate you can defend to a customer without flinching.
The denominator problem
Most electricians set a rate by dividing what they want to make by 2,080 hours. That is the single most expensive piece of arithmetic in the trade.
There are 2,080 working hours in a year on paper. You will not bill anywhere near that. Every hour you spend quoting, driving, at the supply house, chasing a permit, on the phone with a customer, doing invoices at the kitchen table, or waiting on an inspector is an hour that costs you money and produces no revenue.
The hours you actually invoice are the denominator. Everything else — your pay, your overhead, your profit — has to be recovered across only those hours.
| Where the year goes | What it does to the number |
|---|---|
| Vacation, holidays, sick days | Comes straight off the top before you have done anything. |
| Estimating and site visits | Real hours, usually unpaid, and they scale with how many jobs you have to bid to win one. |
| Windshield time | The hidden killer in residential service. Four calls a day can mean two hours of driving. |
| Supply house runs | Every trip converts billable time into unbillable time. |
| Admin, invoicing, collections | Evenings and weekends, which is exactly why it feels invisible and gets priced at zero. |
| Callbacks and warranty | You are paying twice for the same job. Track these — they tell you where your process is broken. |
| Training, licensing, continuing ed | Required, unbillable, recurring. |
What has to live inside the rate
Three layers, in this order. Skip one and you are subsidising your customers out of your own pocket.
Direct labour and its burden
Not just the wage. Payroll taxes, workers’ comp (which is not cheap for electrical classifications), liability insurance, health coverage, retirement, paid time off. The fully burdened cost of an hour of field labour is meaningfully higher than the hourly wage — and if you are the owner working in the field, you have to pay yourself a real wage here before profit exists.
Overhead
Everything that happens whether or not you work today. Truck payments, fuel, insurance, tools and replacement, licensing and bonds, phone and software, accounting, rent or shop space, advertising, and the unbillable admin hours above. Total it for the year, then recover it across your billable hours.
Profit
Profit is not the owner’s wage — that was layer one. Profit is what funds the next truck, absorbs the job that goes wrong, and gives the business a reason to exist beyond employing you. It is a line item you add on purpose, not whatever happens to be left over at the end of the year.
Time and material, flat rate, or diagnostic-first
These are not moral positions. They are different tools, and most successful shops use more than one.
| Model | Works well when | What it costs you |
|---|---|---|
| Time & material | Scope is genuinely unknown — troubleshooting, old-house rewires, anything behind a wall you have not opened yet. | The customer watches the clock, and every efficiency gain you make reduces your own revenue. |
| Flat rate | Repeatable work — device swaps, fixture installs, standard circuits, panel changes you have done a hundred times. | Requires real data on how long tasks take you. Guess low and you eat it every single time until you rebuild the book. |
| Diagnostic first | Service calls. Charge for the diagnosis, then quote the repair as a known scope. | Requires a script and the nerve to hold the line when someone asks you to just take a quick look for free. |
That is the strongest argument for moving repeatable work to flat rate as you gain experience. The tradeoff is that flat rate only works if it is built on your own recorded times — not on a book you bought, and not on a number you liked the sound of.
Building your own flat-rate book
1. Track real times for ninety days
Every task, wheels-to-wheels, including setup, cleanup, and the conversation on the way out. Do not estimate from memory — memory always undercounts. Your phone’s timer is enough to start.
2. Use the honest average, not your best day
Price off the typical job, not the one where everything went right. If a task ranges widely, that is a sign it should stay time and material, or be split into two tasks with different conditions.
3. Apply your loaded hourly rate
The rate you built from the three layers above, multiplied by the honest average time. That is your labour component.
4. Add material at your real margin
At your cost, not the list price you wish you paid, and marked to a margin you chose deliberately. Include the small stuff — wire nuts, straps, staples, sealant. Consumables are invisible individually and material in aggregate.
5. Review it twice a year
Material costs move, your times improve, and your overhead grows. A flat-rate book that has not been touched in three years is losing you money on every line.
The jobs that quietly lose money
- The small service call across town. Thirty minutes of work and ninety minutes of driving. Either your minimum covers the drive or you are paying to be there. Zone your pricing or set a real trip minimum.
- Free estimates on jobs you were never going to win. Track your close rate. If you are winning one in six, five estimates’ worth of unpaid time is baked into every job you do get.
- Troubleshooting priced as installation. Finding the fault is the skill; replacing the device is the easy part. Charge for the diagnosis separately, or you are giving away the only thing a homeowner cannot do themselves.
- The favour for a good customer. Fine occasionally, corrosive as a habit. It resets their expectation of what your time is worth.
- Warranty and callbacks you never log. If you do not track them you cannot see the pattern, and the pattern is usually one crew, one supplier, or one step in your process.
- Change orders done on a handshake. The most common way a profitable job becomes a break-even job. Get the signature before the work, every time.
- The job you took to keep the crew busy. Sometimes correct. Often it is a below-cost job that fills the calendar so you have to turn down the good one that calls next week.
Raising your rate
Every electrician who has ever raised prices reports the same two things: they were terrified, and they lost fewer customers than they expected.
A few things make it easier. Raise on new quotes only, never on work already sold — changing a price mid-job is the one move that genuinely damages trust. Do not announce it or apologise for it; the new number is just the number. And when someone pushes back, do not defend the price by explaining your costs, because your costs are not the customer’s problem. Explain what they are getting instead: the licence, the insurance, the permit pulled properly, work that passes first time, and the fact that you answer the phone in two years when something needs attention.
The customers you lose over a rate increase are almost always the ones who were costing you the most to serve. The ones who stay were never buying on price to begin with.
Put the number on paper properly
A rate is only worth what your paperwork can defend. Estimate, scope, change order and invoice — the documents that turn your price into a signature.
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General business information for trade professionals. Not financial, tax, or legal advice. Rates and ratios vary by market — run your own numbers.