Reference · State of Alabama

Alabama trade labor costs

What a plumbing, HVAC or electrical tech earns in Alabama, what the state adds to payroll, whether labor is taxed, what a license costs, how lien rights work and when the heating and cooling seasons peak — each figure from the agency that sets it, with the date we read it.

  • Wages BLS OEWS May 2025
  • Payroll and licenses state agencies
  • Checked and
Plumbing median
$28.21/h−8.0% vs the U.S.40th of 51
HVAC median
$23.26/h−20.7% vs the U.S.50th of 51
Electrical median
$26.78/h−11.8% vs the U.S.50th of 51
New-employer SUTA
2.70%on the first $8,000
Payroll programs
Noneno paid-leave or disability program found
Sales tax on labor
Not taxedrepair and installation on buildings

Pay in Alabama

Hourly pay across all industries, May 2025. Half of the workers in each trade earn less than the median and half earn more; one in ten earns less than the 10th percentile. Union and non-union, no self-employed.

Hourly pay, 10th to 90th percentileDrawn to scale: one dollar axis for all three trades
  • PlumbingU.S. median $30.67

    plumbers: 10th percentile $18.14, 25th $22.63, median $28.21, 75th $31.12, 90th $36.87 an hour; U.S. median $30.67.

  • HVACU.S. median $29.33

    HVAC techs: 10th percentile $17.56, 25th $19.39, median $23.26, 75th $28.86, 90th $31.58 an hour; U.S. median $29.33.

  • ElectricalU.S. median $30.38

    electricians: 10th percentile $18.09, 25th $22.17, median $26.78, 75th $30.98, 90th $37.61 an hour; U.S. median $30.38.

  • 25th–75th percentile
  • State median
  • U.S. median
Hourly pay by percentile for plumbers, HVAC techs and electricians in Alabama, BLS OEWS May 2025
PercentilePlumbingHVACElectrical
10th$18.14$17.56$18.09
25th$22.63$19.39$22.17
Median$28.21$23.26$26.78
75th$31.12$28.86$30.98
90th$36.87$31.58$37.61
Mean$27.77$24.67$27.65
U.S. median$30.67$29.33$30.38
vs U.S.−8.0%−20.7%−11.8%
Rank40th50th50th
Jobs6,9508,26010,900

Dollars an hour. BLS occupations: Plumbers, pipefitters and steamfitters (SOC 47-2152); Heating, air conditioning and refrigeration mechanics and installers (SOC 49-9021); Electricians (SOC 47-2111). “vs U.S.” compares the medians; rank 1 is the highest median of the 50 states and DC. Released May 15, 2026; the next survey is due each spring.

Payroll costs the state adds

What Alabama charges an employer on top of wages: unemployment tax, and any paid-leave or disability program funded through payroll, and who must carry workers’ comp. Federal Social Security, Medicare and unemployment tax apply in every state and are already in the calculator. Workers’ comp premiums depend on the class code and the insurer, so the card gives the rules, not a rate.

State unemployment tax (SUTA)

Alabama Department of Workforce (Unemployment Compensation)

Wage base
$8,000 per employee a year
New-employer rate
2.70%
Construction
No separate rate published

Charged with it

Per tech, a year 2.70% × $8,000 = $216At the new-employer rate, for a plumber paid the state median ($28.21 × 2,080 h = $58,677). The calculator uses the rate alone.

State pages read

Workers’ compensation

Alabama Department of Labor, Workers' Compensation Division

Who must carry it
5 employees or moreAny business with five or more employees must carry workers’ compensation coverage. Full-time and part-time employees, corporate officers and LLC members all count toward the five. adol.alabama.gov
Where to buy it
Private insurersCoverage is bought from private insurers through a local insurance agency; the State of Alabama does not sell workers’ compensation insurance. Qualifying employers may self-insure under the Division’s security requirements. adol.alabama.gov
Owners
Corporate officers and LLC members count as employees toward the five-employee threshold, the same as full-time and part-time workers. adol.alabama.gov
Construction
A general contractor may charge a subcontractor for workers’ compensation insurance, but no employer may charge an employee for it. adol.alabama.gov

Statute and agency pages read

Paid leave and disability insurance

We found no state paid family and medical leave or temporary disability insurance program funded through payroll in Alabama on October 28, 2026. State paid sick leave rules, where they exist, are not covered here.

New-employer rates usually last one to three years — longer in some states (four years in Indiana, four to five in D.C.); then the state assigns your own rate, and your rate notice wins over any figure here. The calculator below uses the new-employer rate where one is clear. Where a state’s own pages could not be read, the card says so and gives the U.S. Labor Department’s figure.

What a shop in Alabama needs to charge

The calculator’s example shop — three techs, $120,000 of overhead, a truck each, 10% net profit — with Alabama’s median wage for each trade and its unemployment tax filled in. Your own numbers will differ; change them in the calculator below.

Example shopBreak-evenRate, 10% profit
Plumbingwage $28.21$107.38$119.31→ $120
HVACwage $23.26$96.75$107.50→ $110
Electricalwage $26.78$104.31$115.90→ $120

Per billable hour; → is the rate rounded up, as the calculator rounds it. Everything except the wage and the unemployment tax is the national example (BLS, IRS and DOL figures listed on the labor rate calculator).

Change the numbers for your shop

The labor rate calculator, opened on Alabama: pick your trade, put in your own crew, pay and overhead, and the rate and break-even redraw as you type.

Your labor rate

Who does the billable work?

Example shop in Alabama: 3 techs at the state’s median plumber wage, $120,000 overhead. Change any number or pick another state.

Charge at least Example shop · Alabama

Charge at least $119.31 per billable hour; break-even $107.38.

Round up to $120 (+$0.69)

See it drawn to scale
Rate build-upDrawn to scale: every dollar the same height
Rate build-up for the example, drawn to scaleColumn from $0 to $119.31 per billable hour, drawn to scale: wage $48.22, taxes & benefits $12.54, overhead $32.87, truck $13.74, profit 10% $11.93. Break-even line at $107.38. Rounded up to $120.12345$0Labor$60.76Break-even$107.38Your rate$119.31Round up to$120
  1. Wage$58,676.80 ÷ 1,216.8 h$48.22
  2. Taxes & benefits26.01% of pay$12.54
  3. Overhead$120,000 ÷ 3,650.4 h$32.87
  4. Truck$16,719.14 ÷ 1,216.8 h$13.74
  5. Profit 10%of the price$11.93
Break-even
$107.38
Profit per hour
$11.93
Revenue a year
$435,525

$107.38 ÷ (1 − 10%) = $119.31rounded up to $120

Already showing the example.

Price your tasks at $120 an hourOpens the price book builder with this rate.

Billable hours
1,216.8per tech a year
Loaded wage
$35.55per paid hour
Labor
$60.76per billable hour
Overhead
$32.87per billable hour
Truck
$13.74per billable hour
Labor burden
26.01%over gross pay

What moves your rate

  • Every billable hour sold under $107.38 loses money.
  • At 70% billable instead of 65%, break-even drops to $99.71, $7.67 an hour less.
  • Cut $10,000 of overhead a year and break-even drops $2.74 an hour, to $104.64.
Show the math
  1. Worked hours2,080 h − 26 days × 8 h = 1,872 h
  2. Billable hours per tech1,872 h × 65% = 1,216.8 h
  3. Gross pay per tech$28.21 × 2,080 h = $58,676.80
  4. Employer taxes and comp$3,637.96 SS + $850.81 Medicare + $42.00 FUTA + $216.00 SUTA + $1,566.67 comp = $6,313.45
  5. Benefits$58,676.80 × 15.25% = $8,948.21
  6. Labor per billable hour$73,938.46 ÷ 1,216.8 h = $60.76
  7. Overhead per billable hour$120,000 ÷ (3 × 1,216.8 h) = $32.87
  8. Truck per billable hour$16,719.14 ÷ 1,216.8 h = $13.74
  9. Break-even$60.76 + $32.87 + $13.74 = $107.38
  10. Rate at 10% profit$107.38 ÷ (1 − 10%) = $119.31

Change the numbers

State and trade
Trade

Fills the wage and state unemployment tax (SUTA). Workers’ comp and everything else stay as they are.

Filled for Alabama3 figures
Wage Plumbing
$28.21/hr
Alabama median for plumbers · BLS OEWS May 2025
SUTA rate New employer
2.70%
New-employer rate; no separate construction rate found · DOL Significant Provisions, July 2026
SUTA wage base Per tech
$8,000
Alabama · DOL Significant Provisions, July 2026

Your own rate notice wins. These are new-employer rates: after one to three years the state sets your own, and construction employers often pay a different rate.

Alabama: pay, payroll taxes and licensesSee all 50 states and DC
Crew and pay

People who bill hours. Office staff go in overhead.

Average base pay. Filled: Alabama median for plumbers, BLS OEWS May 2025.

Hours and time off2,080 h · 26 days off

40 hours × 52 weeks = 2,080.

Holidays, vacation and sick days, 8 h each. Example: 8 + 11 + 7 (BLS).

Optional. Paid at 1.5 × the wage. Leave 0 if none.

Billable time

Share of worked hours that ends up on invoices. Published figures run from 30% to 65%.

Billable hours1,216.8 hper tech · 3,650.4 h for the shop
Payroll taxes and benefits+26.01% of pay

Filled: Alabama new-employer rate, DOL Significant Provisions, July 2026. Your notice wins.

Pay per tech the rate applies to. Filled: Alabama, DOL Significant Provisions, July 2026.

Use the rate on your policy. Example: BLS construction average.

Health, retirement and other benefits. Example: BLS construction average.

Loaded wage$35.55per paid hour · burden 26.01%

Included automatically (IRS, tax year 2026): Social Security 6.2% of pay up to $184,500, Medicare 1.45%, federal unemployment (FUTA) 0.6% of the first $7,000.

Shop costs

An example figure. Everything except field pay and trucks — split it in the worksheet below.

Payments, fuel, insurance and upkeep. Enter 0 if trucks are already in overhead.

Profit

Profit as a share of the price, not a markup on cost.

Your rate: $119.31 per billable hour · break-even $107.38. Back to the result

Sales tax on your work

What Alabama’s tax agency says about repair and installation labor on buildings and the parts and fixtures that go into them. This is what the agency’s pages say, not tax advice.

Labor
Not taxedThe Department of Revenue treats contractors who build, repair or alter real property as providing a service and using their materials, not selling them at retail to the owner.Its FAQ says labor to repair or install property is exempt when billed as a separate item on the invoice; labor to fabricate an item is not.
Materials
Contractor, when buyingThe contractor pays sales tax to the Alabama vendor, or use tax on purchases from out-of-state vendors that don’t collect the tax, on building materials, including plumbing fixtures, pipe, electrical fixtures, and heating and air conditioning systems.

Read October 24, 2026 on the agency pages listed under Sources. All 50 states and DC side by side.

Licenses and state fees

The license a shop needs from the state to contract for each trade, the board that issues it and the fees on its own schedule. Cities and counties can add their own licenses, registrations and permit fees; exam vendors and fingerprinting may charge more.

Plumbing

State license

Alabama Plumbers and Gas Fitters Examining Board

Master Plumber certificate (plus annual Business registration with the Board)

Master Plumber: a person or legal entity that engages in or works at the installation, repair, or replacement of plumbing systems; may register with the board as principal for any business, firm, or corporation.

FeeAmount
Master written examination fee (non-refundable)one-time (per exam)$160
Business law examination fee (non-refundable)one-time (per exam)$100
Initial application processing feeone-time$50
Initial Master certificate feeone-time (first year)$175
Business registration feeinitial, then $25 per year renewal$25
Master certificate renewal feeper year$175

Fees from Ala. Admin. Code r. 720-X-4-.01 (amended, operative Jan 1, 2026). Since Jan 1, 2026 both the master trade exam and the Business Law exam must be passed. Late renewal penalty for master level is $175.

Keeping the license

Renewal
Plumbing and gas certificates and business registrations from the Alabama Plumbers and Gas Fitters Examining Board renew every year and expire December 31; renewals after December 31 pay a late penalty. pgfb.alabama.gov
Continuing ed.
Journeyman and master plumbers and gas fitters need 4 hours of continuing education each year per certification held, finished before November 1 (rule 720-X-21-.02, in force since January 1, 2025, amended July 13, 2026). Contractors 65 or older are exempt starting the year after they turn 65. admincode.legislature.state.al.us
Reciprocity
The plumbing board has a reciprocal path for holders of a Mississippi Board of Contractors license seeking an Alabama Master Plumber license. Other out-of-state journeyman and master holders may be certified at the matching level under rule 720-X-4-.02 conditions. pgfb.alabama.gov · admincode.legislature.state.al.us

HVAC

State license

Alabama Board of Heating, Air Conditioning and Refrigeration Contractors

Heating & Air Conditioning Contractor certification (Active status); Refrigeration Contractor for commercial refrigeration

Active status: contractors who perform HVAC or refrigeration installation, service or repair; requires a business name and a $20,000 performance bond.

FeeAmount
Written examination feeone-time (per exam)$175
Initial certification feeACTIVE heating and air conditioning licenseone-time (first year)$220
Annual renewal feeACTIVE heating and air conditioning licenseper year$220

Rule 440-X-3-.10 also lists a $375 practical examination fee, a $250 late renewal fee (after Dec 31) and $110/year inactive status. Active status also needs a $20,000 performance bond (cost not a state fee). Board page adds a 4% service fee for credit-card payment.

Keeping the license

Renewal
HVAC and refrigeration contractor licenses from the Alabama Board of Heating, Air Conditioning and Refrigeration Contractors are good for one calendar year and expire December 31; late renewals pay an extra $250. admincode.legislature.state.al.us
Continuing ed.
Certified HVAC and refrigeration contractors need 4 hours of continuing education each year, submitted before November 1; none is required for the first renewal after the license is issued. admincode.legislature.state.al.us
Reciprocity
The HVAC board grants licenses by reciprocity to holders of a current license from the Mississippi, Tennessee, Ohio, South Carolina (both boards), Texas, West Virginia and Louisiana boards who passed an equivalent exam with at least 70%; a $20,000 bond is still required. hacr.alabama.gov

Electrical

State license

Alabama Board of Electrical Contractors

Electrical Contractor (also called Master Electrician)

Electrical Contractor: any person, firm, or corporation engaged in the business of soliciting and installing, maintaining, altering, or repairing electrical power or control systems; term interchangeable with 'Master Electrician'.

FeeAmount
Electrical Contractor examination feeone-time (per exam)$165
Electrical Contractor license feeone-time (first year)$150
Electrical Contractor renewal feeper year$150

Rule 303-X-3-.10 (fees effective Jan 17, 2026). Reciprocal Electrical Contractor license is $315; restoration renewal $50 per year; 4% card service fee per Board page.

Keeping the license

Renewal
Alabama electrical contractor and journeyman electrician licenses expire every year and must be renewed before the last day of the calendar quarter in which they were issued (rules in force since February 14, 2026). admincode.legislature.state.al.us
Continuing ed.
Electrical contractors (and provisional electrical contractors) need 14 hours of continuing education every two years under the Alabama Board of Electrical Contractors rules effective February 14, 2026; up to 7 hours roll over each year, and none is required in the first year of licensure. admincode.legislature.state.al.us
Reciprocity
The electrical board grants electrical contractor licenses by reciprocity to holders from Mississippi, Tennessee, North Carolina, South Carolina, Virginia, Ohio, Louisiana and Texas (Texas also for journeymen) and accepts the NASCLA electrical contractor exam; reciprocity with Georgia has ended. aecb.alabama.gov

Beyond the trade license

Contractor registration, bond and insurance the state asks of a trade shop

Registration
A plumbing, HVAC or electrical shop that takes a job costing $100,000 or more, as prime or as subcontractor, also needs a license from the Alabama Licensing Board for General Contractors (Act 2024-277 raised the threshold from $50,000, effective October 1, 2024). The board’s specialty classifications include Mechanical (HVAC, plumbing, refrigeration) and Electrical. genconbd.alabama.gov · admincode.legislature.state.al.us
Bond
$20,000HVAC and refrigeration contractors on active status must file a $20,000 performance bond in the business name with the Alabama Board of Heating, Air Conditioning and Refrigeration Contractors. The plumbing statute’s master bond (Ala. Code 34-37-13) was repealed in 2015, and the electrical board’s licensing rules set no bond. admincode.legislature.state.al.us · pgfb.alabama.gov
Insurance
None of the three Alabama trade boards’ licensing rules requires liability insurance for the license, and the general contractors board repealed its certificate-of-insurance rule in 2005. admincode.legislature.state.al.us · pgfb.alabama.gov

Board and statute pages read

State or city license?

State and local Who licenses the trades in Alabama

All three trades are licensed by state boards. State plumbing and gas certificates must be accepted by every city and county, which may not require their own competency exam (Ala. Code 34-37-8); the state electrical rules still exempt electricians licensed by the county or city where the work is done, so local electrical licenses exist. Huntsville requires state-board certification plus city permits. pgfb.alabama.gov · admincode.legislature.state.al.us · huntsvilleal.gov

State and city pages read

What Alabama law says about lien rights on private jobs — the notices, the deadline to file and the deadline to sue — and whether a statute sets payment deadlines or caps retainage. Read from the statute itself; it is not legal advice.

Mechanic’s lien

Ala. Code §§ 35-11-210 to 35-11-234Title 35 Property, Chapter 11 Liens, Division 8 Mechanics and Materialmen

You, hired by the owner
No notice to startNo pre-lien notice is required from the original contractor who contracts with the owner: Ala. Code § 35-11-218 requires the written notice of the lien claim only from every person except the original contractor. The original contractor files the verified lien statement in the probate judge’s office (§ 35-11-213). alison.legislature.state.al.us
Subs and suppliers
Notice requiredBefore filing the lien statement, every sub, supplier or laborer (anyone but the original contractor) must give the owner or the owner’s agent written notice of the lien claimed, stating the amount, what it is for and who owes it (§ 35-11-218); after that notice the owner’s unpaid balance is held subject to the lien. A supplier who instead notifies the owner in writing before furnishing material, at specified prices, gets a lien for the full price unless the owner objects in writing before the material is used (§ 35-11-210). alison.legislature.state.al.us
File the lien
6 monthsAn original contractor must file the verified lien statement with the probate judge within 6 months after the last work or material was furnished; every other lien claimant (subs, suppliers) has 4 months, and journeymen and day laborers have 30 days (§ 35-11-215). alison.legislature.state.al.us
Enforce it
6 monthsSuit to enforce the lien must be filed within 6 months after the entire debt secured by the lien comes due (§ 35-11-221); claims over $50 go to circuit court in the county where the property is (§ 35-11-220). alison.legislature.state.al.us

Statutes read

Payment deadlines and retainage

Private jobs (public contracts have their own rules)

Prompt payment
Statute sets deadlinesAlabama’s Prompt Pay Act covers private jobs: the owner must pay the contractor by the agreed terms or, if none were agreed, within 30 days after receiving the pay request or invoice, and the contractor must pay subs within 7 days after the owner pays (§ 8-29-3); late payment carries interest at 1% per month (12% a year). The act does not apply to residential homebuilders, residential projects of 16 or fewer units, contracts of $10,000 or less, or state and local government contracts (§ 8-29-7). alison.legislature.state.al.us
Retainage
Capped at 10%On jobs covered by the Prompt Pay Act, retainage may not exceed 10% of work properly done and stored materials, and no further retainage may be withheld after the job is 50% complete; over-withholding earns 1% per month interest (§ 8-29-3(i)–(k)). The owner must release retainage within 60 days after the contractor’s work is complete or after substantial completion, whichever is first, with all certificates of occupancy issued (§ 8-29-3(l)). alison.legislature.state.al.us

Statutes read

Heating and cooling season in Alabama

Degree days, NOAA’s index of the energy it takes to heat or cool a building: each degree a day’s mean temperature falls below 65 °F is one heating degree day, each degree above is one cooling degree day. Thirty-year normals for Birmingham airport, month by month.

Heating degree days
2,534
Cooling degree days
2,177
Nights ≤ 32 °F
47
Days ≥ 90 °F
65
Normal heating and cooling degree days (base 65 °F) and freezing nights by month at Birmingham airport, NOAA 1991–2020 normals
MonthHeatingCoolingNights ≤ 32 °F
Jan631215
Feb459410
Mar301234
Apr117741
May21223–
Jun0399–
Jul0513–
Aug0494–
Sep6324–
Oct105104–
Nov344145
Dec550412

Birmingham airport has two working seasons: 2,534 heating and 2,177 cooling degree days a year, heating peaking in January and cooling in July.

The lightest months for heating and cooling together are April and October (190 and 209 degree days).

Nights at or below 32 °F: about 47 a year, ten or more a month in December through January. Days reaching 90 °F: about 65 a year, the most in July.

Weighted by where Alabama’s people live, NOAA’s statewide normals (1981–2010) are 2,768 heating and 1,863 cooling degree days — 41st for heating and 8th for cooling among the 48 contiguous states (the contiguous U.S.: 4,332 and 1,272).

Station: Birmingham airport (USW00013876), NOAA NCEI U.S. Climate Normals 1991–2020 — station file; statewide figures: NOAA Climate Prediction Center. Bars share one scale: the longest is 631 degree days. Read .

Sources

Each page opened on the date shown. License, registration, lien and workers’ comp sources are linked beside each fact above. Figures change: the agency’s own page wins over this one.

  1. May 2025 State Occupational Employment and Wage Estimates (state file oesm25st)U.S. Bureau of Labor Statistics · read October 28, 2026
  2. Occupational Employment and Wages — May 2025 (news release USDL-26-0725, May 15, 2026)U.S. Bureau of Labor Statistics · read October 28, 2026
  3. Public Data API (national OEWS series for the three occupations)U.S. Bureau of Labor Statistics · read October 28, 2026
  4. Unemployment insurance tax rates (workforce.alabama.gov)Alabama Department of Workforce (Unemployment Compensation) · read October 28, 2026
  5. Unemployment insurance tax rates (workforce.alabama.gov)Alabama Department of Workforce (Unemployment Compensation) · read October 28, 2026
  6. Significant Provisions of State Unemployment Insurance Laws, Effective July 2026U.S. Department of Labor, Office of Unemployment Insurance · read October 28, 2026
  7. Who is a contractor?Alabama Department of Revenue · no date shown · read October 24, 2026
  8. Rule 810-6-1-.27, Building MaterialsAlabama Department of Revenue · readopted effective October 1, 1982 · read October 24, 2026
  9. What type of sales are made where no sales tax is due?Alabama Department of Revenue · no date shown · read October 24, 2026
  10. Ala. Code §§ 35-11-210 to 35-11-234 — Title 35 Property, Chapter 11 Liens, Division 8 Mechanics and MaterialmenOfficial state code · read November 4, 2026
  11. Workers’ compensation coverage requirementsAlabama Department of Labor, Workers' Compensation Division · read November 4, 2026
  12. U.S. Climate Normals 1991–2020, Birmingham airport (USW00013876)NOAA National Centers for Environmental Information · read November 4, 2026
  13. Population-weighted daily heating and cooling degree day normals, 1981–2010 (states and CONUS)NOAA National Weather Service, Climate Prediction Center · read November 4, 2026