Welding and fabrication
Fabrication shop hourly rate
Recover shop overhead from realistic productive machine and labor hours.
Your inputs
Complete the fields for your selected method. Zero means intentionally zero, not unknown. Currency selection labels amounts; it does not convert exchange rates.
How this calculation works
annual overhead/productive hours+direct hourly costs+profit allowance.
Use a consistent shop-hour basis for overhead and direct costs. Qualified welding processes only; this does not approve a process or weld design.
What information do I need?
Use records for the same job, equipment or accounting period. Only the fields for your selected entry method are required. An unknown amount is not zero.
Input definitions and where to find them
- Annual shop overhead (selected currency): Use matching records or a clearly identified owner assumption for annual shop overhead, in the displayed unit and the stated row/period scope.
- Annual productive shop hours (hours/year): Productive SHOP-hour basis consistent with direct hourly costs; do not mix machine-hour sums and one-worker hours.
- Direct cost per productive shop hour (selected currency): Matching invoice, quote, statement, bookkeeping record or explicit budget amount for direct cost per productive shop hour. Use the stated period and exclude amounts already counted in another field. Zero means intentionally excluded/not incurred, not unknown.
- Profit allowance per productive shop hour (selected currency): Matching invoice, quote, statement, bookkeeping record or explicit budget amount for profit allowance per productive shop hour. Use the stated period and exclude amounts already counted in another field. Zero means intentionally excluded/not incurred, not unknown.
Use the Where to find this value controls beside the inputs for available work-it-out helpers. Estimates remain your assumptions; a helper does not verify the source figures.
Worked example
Example amounts use US dollars (USD).
Example answer: Required shop hourly rate is $90.00 for the illustrative inputs below.
Example inputs
- Annual shop overhead: $60,000.00
- Annual productive shop hours: 1,500.00 hours/year
- Direct cost per productive shop hour: $40.00
- Profit allowance per productive shop hour: $10.00
- Required shop hourly rate
- $90.00
- Overhead per productive hour
- $40.00
These illustrative values are not recommended rates or industry averages. Replace every example input with your own figures.
Use the result well
Recover shop overhead from realistic productive machine and labor hours.
Keep inputs on the same scope and time basis. Calculations retain precision internally; displayed values generally round to two decimal places, with extra precision for very small values and whole-unit rounding where required. Economic comparisons describe your supplied assumptions and do not guarantee future results.
This tool provides business arithmetic. It does not approve engineering designs, establish legal or tax treatment, select equipment or certify safe operating conditions.