Electrical Service Rates

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chrisbourke

Member
I have long been affiliated with plumbing and HVAC companies and every time the subject is brought up, it is dead clear that the hourly rates for electrical work are generally 10% to 20% lower than the other two crafts, and proportionally so are the hourly wages. Why is this and does any other area of the country have this problem(I reside in Nebraska)(Nebraska has a state wide recognized licensing program for electrical but not plumbing or HVAC)
 
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aline

Senior Member
Location
Utah
Re: Electrical Service Rates

I believe this is the case all accross the USA.
I think we are electricians first and business people second. We need to become business people first and electricians second.
I think a lot of us don't know or choose to ignore out overhead costs and set our prices too low. We are afraid that if our prices are higher than the next guy we won't get the job.
Plumbers and HVAC people use a flat rate pricing system instead of billing time and material.
I was using T&M billing and was having a hard time raising my rates. I switched to a flat rate system and doubled my hourly rate. It is currently at $100 per hour. I will need to raise it to about $130 per hour to cover my advertising & marketing costs I would like to implement. I would also like to maintain at least a 10% net profit. MY current target goal is 15%net profit. I don't think I could charge this amount using T&M billing. The going rate in my area for T&M is $40 to $60 per hour. I'm losing money at this rate.
I have been learning from the Plumbing and HVAC people on how to run my business.
Some good information can be found at www.thesuccessfulcontractor.com

[ January 07, 2005, 07:26 PM: Message edited by: aline ]
 
hey_poolboy

hey_poolboy

Senior Member
Location
Illinois
Re: Electrical Service Rates

Flat rate pricing is the way to go. I have used a system designed by "Calahan Roach" at a previous employer. I don't think that they make anything specific for the electrical contractor as they do for swimming pool service and HVAC, but it is a good platform to build off of.

Mike
 
don_resqcapt19

don_resqcapt19

Moderator
Staff member
Location
Illinois
Occupation
retired electrician
Re: Electrical Service Rates

I looked at the posted prevailing wage rates for two counties in Illinois and the total package for electricians is higher than plumbers or sheet metal workers, but in both counties, the "on the check" money is higher for plumbers. In Cook county, the plumber gets 3.9% more on the check, but when the fringes are added in, the electrician gets 10.2% more than the plumber.
Here are the numbers. The first number is "on the check" and the second includes the fringes.
Cook County
Electrician.....$34.65....$49.18
Plumber.........$36.00....$44.14
Sheet Metal...$33.40....$47.71

LaSalle County
Electrician.....$33.41....$49.76
Plumber.........$34.96....$47.05
Sheet Metal...$29.74....$40.34

Of course this does not reflect what the employer charges, and the size of the shop and overhead will play a big part in what the shop has to charge to make a profit. The type of work will also make a difference as the tooling and equipment costs must be included in the total shop rate.
Don
 
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