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Reference · State of Arizona

Arizona trade labor costs

What a plumbing, HVAC or electrical tech earns in Arizona, 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
$29.84/h−2.7% vs the U.S.33rd of 51
HVAC median
$28.56/h−2.6% vs the U.S.34th of 51
Electrical median
$29.36/h−3.4% vs the U.S.38th of 51
New-employer SUTA
2.00%on the first $8,000
Payroll programs
Noneno paid-leave or disability program found
Sales tax on labor
Dependsrepair and installation on buildings

Pay in Arizona

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 $21.94, 25th $23.84, median $29.84, 75th $38.27, 90th $48.13 an hour; U.S. median $30.67.

  • HVACU.S. median $29.33

    HVAC techs: 10th percentile $18.25, 25th $22.68, median $28.56, 75th $35.49, 90th $38.54 an hour; U.S. median $29.33.

  • ElectricalU.S. median $30.38

    electricians: 10th percentile $21.89, 25th $23.25, median $29.36, 75th $37.05, 90th $43.08 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 Arizona, BLS OEWS May 2025
PercentilePlumbingHVACElectrical
10th$21.94$18.25$21.89
25th$23.84$22.68$23.25
Median$29.84$28.56$29.36
75th$38.27$35.49$37.05
90th$48.13$38.54$43.08
Mean$32.66$29.28$30.88
U.S. median$30.67$29.33$30.38
vs U.S.−2.7%−2.6%−3.4%
Rank33rd34th38th
Jobs11,81010,86021,140

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 Arizona 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.

Workers’ compensation

Industrial Commission of Arizona

Who must carry it
Any employeeEvery employer that regularly employs any worker in the same business must carry workers’ compensation (A.R.S. § 23-902(A)); only employers of domestic servants are exempt. Employees who work only part of the year count as regularly employed. azleg.gov
Where to buy it
Private insurersEmployers must insure with a carrier authorized by the Arizona Department of Insurance and Financial Institutions, or get Industrial Commission approval to self-insure directly or through an approved pool (A.R.S. § 23-961(A)). No substitute for workers’ compensation may be sold. azleg.gov
Owners
Sole proprietors, working partners and LLC members owning 50% or more are covered only if the insurer accepts their application by endorsement; working LLC members owning less than 50% are employees (A.R.S. § 23-901(6)). A sole proprietor who works as an independent contractor can waive coverage by signing the § 23-961(N) waiver together with the hiring business’s insurer, but must still insure any employees. azleg.gov
Construction
When a business hires a contractor for work that is part of its own trade and keeps supervision or control, the contractor, subcontractors and their employees count as the hiring business’s employees (A.R.S. § 23-902(B)). A written independent-contractor agreement meeting § 23-902(D) creates a rebuttable presumption that the worker is not an employee. azleg.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 Arizona 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 Arizona needs to charge

The calculator’s example shop — three techs, $120,000 of overhead, a truck each, 10% net profit — with Arizona’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 $29.84$110.83$123.15→ $125
HVACwage $28.56$108.08$120.09→ $125
Electricalwage $29.36$109.80$122.00→ $125

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

Charge at least Example shop · Arizona

Charge at least $123.15 per billable hour; break-even $110.83.

Round up to $125 (+$1.85)

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 $123.15 per billable hour, drawn to scale: wage $51.01, taxes & benefits $13.21, overhead $32.87, truck $13.74, profit 10% $12.31. Break-even line at $110.83. Rounded up to $125.12345$0Labor$64.22Break-even$110.83Your rate$123.15Round up to$125
  1. Wage$62,067.20 ÷ 1,216.8 h$51.01
  2. Taxes & benefits25.9% of pay$13.21
  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$12.31
Break-even
$110.83
Profit per hour
$12.31
Revenue a year
$449,530

$110.83 ÷ (1 − 10%) = $123.15rounded up to $125

Already showing the example.

Price your tasks at $125 an hourOpens the price book builder with this rate.

Billable hours
1,216.8per tech a year
Loaded wage
$37.57per paid hour
Labor
$64.22per billable hour
Overhead
$32.87per billable hour
Truck
$13.74per billable hour
Labor burden
25.9%over gross pay

What moves your rate

  • Every billable hour sold under $110.83 loses money.
  • At 70% billable instead of 65%, break-even drops to $102.91, $7.92 an hour less.
  • Cut $10,000 of overhead a year and break-even drops $2.74 an hour, to $108.09.
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$29.84 × 2,080 h = $62,067.20
  4. Employer taxes and comp$3,848.17 SS + $899.97 Medicare + $42.00 FUTA + $160.00 SUTA + $1,657.19 comp = $6,607.34
  5. Benefits$62,067.20 × 15.25% = $9,465.25
  6. Labor per billable hour$78,139.78 ÷ 1,216.8 h = $64.22
  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$64.22 + $32.87 + $13.74 = $110.83
  10. Rate at 10% profit$110.83 ÷ (1 − 10%) = $123.15

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 Arizona3 figures
Wage Plumbing
$29.84/hr
Arizona median for plumbers · BLS OEWS May 2025
SUTA rate New employer
2.00%
New-employer rate; no separate construction rate found · DOL Significant Provisions, July 2026
SUTA wage base Per tech
$8,000
Arizona · 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.

Arizona: 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: Arizona 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+25.9% of pay

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

Pay per tech the rate applies to. Filled: Arizona, 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$37.57per paid hour · burden 25.9%

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: $123.15 per billable hour · break-even $110.83. Back to the result

Sales tax on your work

What Arizona’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
DependsMaintenance, repair, replacement and alteration (MRRA) work is not taxed. New construction and larger alterations are prime contracting, taxed under the transaction privilege tax (TPT) on 65% of gross receipts.The Department of Revenue’s MRRA examples include fixing a leaky tub or shower and replacing an HVAC unit. An alteration becomes taxable modification above 25% of a home’s tax value or $750,000 for commercial property.
Materials
Depends on the job or contractOn MRRA jobs the contractor pays TPT on its materials and puts no tax line on the invoice; on prime contracting jobs the tax falls on the project’s gross receipts.

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, HVAC and Electrical

State license

Arizona Registrar of Contractors

  • Plumbing Specialty contractor license (specialty commercial, specialty residential, or specialty dual) in the plumbing classification
  • HVAC Specialty contractor license (specialty commercial, specialty residential, or specialty dual) in the air conditioning/refrigeration (HVAC) classification
  • Electrical Specialty contractor license (specialty commercial, specialty residential, or specialty dual) in the electrical classification

Any person, firm, partnership, corporation or other organization that engages in the business of, bids or offers to act as a contractor must hold a contractor’s license in good standing (A.R.S. 32-1151).

Fees: check with the state. The board’s fee schedule could not be confirmed on October 28, 2026.

Fees are set by the Arizona Registrar of Contractors (A.A.C. R4-9-130) and listed on its fee page (roc.az.gov/licensing-fees), which could not be opened for this page, so no fee amounts are shown. State law (A.R.S. 32-1126) caps the application and license fee for a new two-year license at $350 (specialty residential), $1,000 (specialty commercial) or $1,350 (specialty dual), and the two-year renewal at $270 / $900 / $1,170. Residential licenses also pay up to $600 per two-year period into the residential contractors' recovery fund. Late renewal penalty: $50.

Keeping the license

Renewal
PlumbingArizona Registrar of Contractors licenses, including plumbing classifications, renew every two years on staggered dates; the registrar may allow annual renewal on a hardship petition. A license not renewed is suspended the next business day and can be reactivated within one year with a $50 fee (ARS 32-1123.01, 32-1125). azleg.govHVACArizona Registrar of Contractors licenses, including air-conditioning and mechanical classifications, renew every two years on staggered dates; the registrar may allow annual renewal on a hardship petition. A license not renewed is suspended the next business day and can be reactivated within one year with a $50 fee (ARS 32-1123.01, 32-1125). azleg.govElectricalArizona Registrar of Contractors licenses, including electrical classifications, renew every two years on staggered dates; the registrar may allow annual renewal on a hardship petition. A license not renewed is suspended the next business day and can be reactivated within one year with a $50 fee (ARS 32-1123.01, 32-1125). azleg.gov
Continuing ed.
Arizona’s contractor licensing statutes set no continuing-education requirement to renew an ROC license; renewal requires the application, fee and a bond in force. azleg.gov
Reciprocity
Check with the boardThe official page that settles this refused a normal read on November 4, 2026.

Sources read

Beyond the trade license

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

Registration
In Arizona the trade license is itself a contractor license from the Registrar of Contractors (plumbing, HVAC and electrical are ROC license classifications); no separate statewide contractor registration is layered on top. Residential and dual licensees also pay into the Residential Contractors’ Recovery Fund (up to $600 per two-year period) unless they post an extra $200,000 bond (ARS 32-1152(C), 32-1126(G)). azleg.gov
Bond
$2,500Every ROC license needs a surety bond or cash deposit before it is issued and to renew (ARS 32-1152). A specialty residential contractor (such as residential plumbing, HVAC or electrical) posts $1,000 to $7,500; a specialty commercial contractor with under $150,000 in yearly volume posts $2,500, rising to $37,500-$50,000 at $10 million or more; dual (residential plus commercial) licensees post both amounts. azleg.gov
Insurance
Arizona’s contractor licensing law does not require liability insurance for an ROC license; the applicant must only attest to compliance with workers’ compensation law and give the policy number when workers’ comp is required (ARS 32-1122(B)(1)(i)). azleg.gov

Board and statute pages read

State or city license?

Check Who licenses the trades in Arizona

Check with the state Whether cities and counties also license these trades: The official pages and rules we read on November 4, 2026 do not settle it.

State and city pages read

What Arizona 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

A.R.S. §§ 33-981 to 33-1008Title 33, Chapter 6, Article 6: Mechanics’ and Materialmen’s Liens

You, hired by the owner
Yes. Everyone who furnishes labor, services or materials, except a worker paid wages, must serve a written preliminary twenty-day notice as a condition of a valid lien, so a contractor who deals directly with the owner gives it too. Serve the owner, the original contractor, the construction lender (if any) and the person you contracted with, no later than 20 days after you first furnish labor or materials to the jobsite (A.R.S. § 33-992.01(B)–(C)). azleg.gov
Subs and suppliers
Notice requiredSubs and suppliers must serve the same preliminary twenty-day notice within 20 days after first furnishing to the jobsite, on the owner, the original contractor, the construction lender and whoever hired them (A.R.S. § 33-992.01). A late notice still works, but the lien then covers only what you furnished within 20 days before the notice and afterward. azleg.gov
File the lien
120 daysRecord the notice and claim of lien with the county recorder within 120 days after completion of the building, structure or improvement, or within 60 days after the owner records a notice of completion, then serve a copy on the owner (A.R.S. § 33-993(A)). The same deadline applies to subs. azleg.gov
Enforce it
6 monthsThe lien lasts only 6 months after it is recorded unless you sue to enforce it within that time and record a notice of pendency of action with the county recorder (A.R.S. § 33-998(A)). azleg.gov
Homes
On a one- or two-family dwelling of an owner-occupant, only a contractor who signed a written contract directly with the owner-occupant may record a lien; subs and suppliers cannot lien that home, and any waiver of this rule is void (A.R.S. § 33-1002). The private prompt-pay rules for owners apply to an owner-occupant’s dwelling only if each bill carries the statutory ‘Notice to owner of applicability of Arizona prompt pay act’ (A.R.S. § 32-1188). azleg.gov

Statutes read

Payment deadlines and retainage

Private jobs (public contracts have their own rules)

Prompt payment
Statute sets deadlinesArizona’s prompt pay act (A.R.S. §§ 32-1181 to 32-1188) covers private jobs: a bill is deemed approved 14 days after the owner receives it unless the owner gives written reasons, and the owner must pay within 7 days after approval; late payment earns 1.5% per month (§ 32-1182). The contractor must pay subs and suppliers within 7 days after receiving each payment, with 1.5% per month interest from the eighth day (§ 32-1183); the act does not bind the state or political subdivisions (§ 32-1187). azleg.gov
Retainage
No percentage cap applies on private jobs: the owner may withhold ‘a reasonable amount for retention’ (A.R.S. § 32-1182(D)). At substantial completion the contractor bills for release; the bill is deemed approved in 14 days unless the owner states reasons, the owner may hold back no more than 150% of the cost of unfinished items, and must pay within 7 days after approval (§ 32-1182(A), (H)). azleg.gov

Statutes read

Heating and cooling season in Arizona

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 Phoenix Sky Harbor airport, month by month.

Heating degree days
874
Cooling degree days
4,765
Nights ≤ 32 °F
1
Days ≥ 90 °F
173
Normal heating and cooling degree days (base 65 °F) and freezing nights by month at Phoenix Sky Harbor airport, NOAA 1991–2020 normals
MonthHeatingCoolingNights ≤ 32 °F
Jan2562–
Feb15916–
Mar65105–
Apr14259–
May1528–
Jun0792–
Jul0945–
Aug0910–
Sep0727–
Oct6390–
Nov8588–
Dec2892–

Cooling carries the load at Phoenix Sky Harbor airport: 4,765 cooling degree days a year against 874 heating degree days, peaking in July (945).

The lightest months for heating and cooling together are March and November (170 and 173 degree days).

Nights at or below 32 °F: about 1 a year. Days reaching 90 °F: about 173 a year, the most in July.

Weighted by where Arizona’s people live, NOAA’s statewide normals (1981–2010) are 1,955 heating and 2,963 cooling degree days — 45th for heating and 2nd for cooling among the 48 contiguous states (the contiguous U.S.: 4,332 and 1,272).

Station: Phoenix Sky Harbor airport (USW00023183), NOAA NCEI U.S. Climate Normals 1991–2020 — station file; statewide figures: NOAA Climate Prediction Center. Bars share one scale: the longest is 945 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 (azleg.gov)Arizona Department of Economic Security (Unemployment Tax) · read October 28, 2026
  5. Unemployment insurance tax rates (azleg.gov)Arizona Department of Economic Security (Unemployment Tax) · 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. MRRA ContractingArizona Department of Revenue · no date shown · read October 24, 2026
  8. Contracting FAQsArizona Department of Revenue · no date shown · read October 24, 2026
  9. A.R.S. §§ 33-981 to 33-1008 — Title 33, Chapter 6, Article 6: Mechanics’ and Materialmen’s LiensOfficial state code · read November 4, 2026
  10. Workers’ compensation coverage requirementsIndustrial Commission of Arizona · read November 4, 2026
  11. U.S. Climate Normals 1991–2020, Phoenix Sky Harbor airport (USW00023183)NOAA National Centers for Environmental Information · read November 4, 2026
  12. 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