If you pay a janitor $16/hour, your actual cost is $20–24/hour. Where does the extra $4–8 go? Payroll taxes, insurance, benefits, and invisible costs that eat into your margins.
When you hire a janitor at $16.29/hour (the BLS national median for SOC 37-2011, "Janitors and Cleaners"), your true cost is 1.25–1.40× that amount — or $20.36 to $22.81 per hour. This multiplier comes from mandatory employer-side costs that are invisible on the employee's pay stub but very real on your P&L.
Most cleaning business owners know about "some" extra costs but dramatically underestimate the total. The result? Bids that look profitable on paper but lose money in practice.
Here's every cost that sits on top of the base wage, with the exact rate and source:
FICA (7.65%): You match the employee's Social Security (6.2%) and Medicare (1.45%) contributions. On $16.29/hr, that's $1.25/hr. (Source: SSA — ssa.gov)
FUTA (0.6%): Federal Unemployment Tax on the first $7,000 of wages per employee. Works out to $42/year per employee max. (Source: IRS Publication 15)
SUTA (varies by state): State Unemployment Tax ranges from 1.2% in North Carolina to 4.1% in New York. Applied to the first $8,500–$12,000 of wages depending on state. (Source: U.S. Department of Labor, Employment & Training Administration)
Workers' Compensation (3.7% avg): Janitorial falls under NCCI class code 9014. Your rate depends on your experience modifier and state, but the national average is about 3.7% of gross payroll. (Source: NCCI)
Paid Leave & Benefits (7.7%): Vacation, sick time, holidays, and miscellaneous benefits. BLS Employer Costs for Employee Compensation pegs this at 7.7% of total compensation for service workers.
Health Insurance (optional): If you offer coverage, the average employer share is $7,911/year for single coverage, or $659/month. (Source: BLS ECEC 2024)
Let's walk through a real example. A full-time janitor in Dallas, TX:
→ Base wage: $14.53/hr (BLS Dallas metro median) × 40 hrs × 52 weeks = $30,222/year
→ FICA (7.65%): $2,312
→ FUTA (0.6% on $7k): $42
→ Texas SUTA (2.7% on $9k): $243
→ Workers comp (3.7%): $1,118
→ Paid leave (7.7%): $2,327
→ Health insurance: $0 (not offered)
Total annual cost: $36,264
Effective hourly rate: $17.43/hr
Multiplier: 1.20×
Without health insurance, the multiplier is 1.20×. Add health insurance and it jumps to 1.46×. This is the number you must use when calculating your bid — not the base wage.
If you bid using the base wage ($14.53/hr in the Dallas example), you're immediately losing $2.90/hr per worker in unbilled costs. On a contract requiring 60 hours/month of labor, that's $174/month — or $2,088/year — lost on one contract.
The fix is simple: always use the fully-loaded rate when calculating bids. Most bidding software doesn't do this automatically — which is why we built it into xiriOS. Our calculator uses the true employer cost (including FICA, FUTA, SUTA, and workers comp) when calculating labor costs for your bids.
Use our free employee cost calculator to see the real number. Select your state for the correct SUTA rate, input the hourly wage and hours per week, and optionally add health insurance. Every rate cites its government source.
Built on SSA, IRS, DOL, BLS, and NCCI data.
Try the Employee Cost Calculator →Knowing your true employee costs is step one. Our complete startup guide walks you through everything from registering your LLC to landing your first commercial contract — including how to use loaded labor rates to price profitably from day one.
Read the Startup Cost Breakdown →Our free janitorial bid calculator uses real ISSA production rates. No sign-up required.