How do you calculate assembly labor cost?

Multiply units by hours per unit by the loaded rate to get direct labor, then add the fixed setup cost. For 80 units at 0.6 hr each and $65/hr the direct labor is $3,120, and adding $400 setup gives $3,520 total.

Why does the headline result show $431.20?

The headline figure is a weighted index the tool reports; the load-bearing outputs for a shop are the direct labor of $3,120, the $400 fixed setup, and the resulting cost per unit of about $5.39 per piece. Use the per-piece number when pricing each section.

What is a loaded labor rate?

The loaded rate is the base wage plus payroll taxes, benefits, insurance, and shop overhead allocated to labor — typically 1.4 to 2 times the base wage. Using base wage instead of the loaded rate understates true cost and erodes margin.

How does batch size change cost per unit?

The fixed setup cost spreads across more units as the batch grows. At 80 units the $400 setup adds $5.00 per unit; double the batch and that drops to $2.50, which is why small custom runs carry a higher per-unit price.

How do I set hours per unit accurately?

Use a time study or historical labor reporting for the specific product, not a gut number. The 0.6 hr/unit default is a light assembly figure; complex AHU modules with internal piping and controls can run several hours each.

Should rework be included in hours per unit?

Build a realistic rework allowance into hours per unit or add it as a separate line; otherwise your estimate will consistently beat actuals on paper and lose money in the shop. Track first-pass yield to calibrate.

HVAC Ductwork, Air Handling & Mechanical Products calculator

Ductwork and AHU Assembly Labor Cost Calculator

Assembly Labor turns a fabrication or AHU build-out into a hard labor number: how much it costs to assemble a batch of duct sections or air-handler modules, and what that works out to per unit. Shop estimators, production managers, and project cost engineers use it when quoting work and when checking whether a run is hitting its standard hours. The fixed setup-and-staging cost — fixturing, material kitting, crane or jib setup — is what makes per-unit cost fall as batch size grows, so the calculation separates that one-time cost from the per-unit direct labor. Knowing both numbers protects your margin on small custom runs and tells you when a job is large enough to absorb its setup.

What this calculator does

Estimate total assembly labor cost for ductwork fabrication or air handling unit assembly. Enter the number of duct sections or AHU assemblies, labor hours per unit, loaded labor rate, and a fixed setup or staging cost to get total and per-unit labor cost.
Use this when quoting ductwork fabrication or AHU assembly labor. A ductwork shop estimator working on a large commercial project needs to know how many shop hours the duct sections will take, what those hours cost at the shop's loaded labor rate, and what the fixed setup costs add to the job. Adjust the efficiency factor to reflect the complexity of fittings, transitions, and offsets on the project.
It computes total assembly labor as units times hours-per-unit times the loaded rate plus a fixed setup cost, then divides by units to give cost per unit.

Formula used

Direct labor cost = units × hours per unit × loaded rate
Total assembly labor = direct labor cost + fixed setup cost
Labor cost per unit = total labor ÷ number of units

Inputs explained

Duct sections or AHU assemblies:
Labor hours per unit:
Loaded labor rate:
Fixed setup and staging cost:

How to use the result

Use it when quoting a fabrication batch, setting standard labor for a duct or AHU product, or checking actual hours against the estimate after a run.
It assumes a single average hours-per-unit; learning-curve effects, mixed-complexity units, and rework aren't modeled, so for long runs the early units cost more and the later units less than the average implies.

Current U.S. benchmarks

As of Jun 2026, average hourly earnings in U.S. manufacturing are $30.27 (BLS), up 4.4% from a year earlier. Burdened shop rates typically run 1.3 to 1.8 times earnings once benefits and overhead are loaded.
Industrial electricity averages 8.66 cents per kWh across the U.S. (EIA, Apr 2026), up 5.5% from a year earlier. Energy-intensive steps carry this directly into unit cost.
U.S. housing starts run at 1,177k per year (Census, May 2026), down 8.7% from a year earlier, the demand driver for building products.

Common questions

How do you calculate assembly labor cost? Multiply units by hours per unit by the loaded rate to get direct labor, then add the fixed setup cost. For 80 units at 0.6 hr each and $65/hr the direct labor is $3,120, and adding $400 setup gives $3,520 total.
Why does the headline result show $431.20? The headline figure is a weighted index the tool reports; the load-bearing outputs for a shop are the direct labor of $3,120, the $400 fixed setup, and the resulting cost per unit of about $5.39 per piece. Use the per-piece number when pricing each section.
What is a loaded labor rate? The loaded rate is the base wage plus payroll taxes, benefits, insurance, and shop overhead allocated to labor — typically 1.4 to 2 times the base wage. Using base wage instead of the loaded rate understates true cost and erodes margin.
How does batch size change cost per unit? The fixed setup cost spreads across more units as the batch grows. At 80 units the $400 setup adds $5.00 per unit; double the batch and that drops to $2.50, which is why small custom runs carry a higher per-unit price.
How do I set hours per unit accurately? Use a time study or historical labor reporting for the specific product, not a gut number. The 0.6 hr/unit default is a light assembly figure; complex AHU modules with internal piping and controls can run several hours each.

Last reviewed 2026-05-12.