Plumbing Contractor Cost Structure: Where Each Revenue Dollar Goes
The short answer
Of every dollar US plumbing, heating and air-conditioning contractors took in during 2022, 31.5 cents went on materials, parts and supplies, 27.0 cents on payroll and 7.9 cents on benefits and payroll taxes, according to the 2022 Economic Census. Subcontracted work took 7.1 cents. That leaves 24.2 cents for every other cost and profit. Revenue per employee was $254,434.
The short answer, expanded
Contractor benchmarking surveys come from software vendors and associations whose members are not a random sample. The Economic Census is a census: every employer establishment in NAICS 238220 reports its revenue, payroll, benefits and what it spent on materials, subcontractors and energy. That makes it the definitive cost structure for the plumbing and HVAC trade as a whole, and the 2017 census gives a five-year comparison.
| Where the revenue went (2022) | Amount | Cents per revenue dollar | 2017 cents |
|---|---|---|---|
| Materials, parts and supplies | $93.7 billion | 31.5 | 32.4 |
| Payroll | $80.4 billion | 27.0 | 29.2 |
| Employee benefits and payroll taxes | $23.6 billion | 7.9 | 9.3 |
| Subcontracted work | $21.2 billion | 7.1 | 7.7 |
| Fuel and energy | $6.8 billion | 2.3 | 2.2 |
| Everything else (overhead, insurance, rent, depreciation, profit) | $72.0 billion | 24.2 | 19.3 |
| Total revenue | $297.6 billion | 100.0 | 100.0 |
Source: Census Bureau, 2022 and 2017 Economic Census, construction sector basic tables (EC2223BASIC, EC1723BASIC), NAICS 238220. ‘Everything else’ is calculated by The Plumbing Brief as revenue minus the listed items and is not a profit figure.
The evidence
- Revenue 2022: $297.6 billion; 2017: $206.2 billion. Source: Census Bureau.
- Cost of materials, parts and supplies 2022: $93.7 billion (31.5 percent); 2017: 32.4 percent. Source: Census Bureau.
- Annual payroll 2022: $80.4 billion (27.0 percent); 2017: 29.2 percent. Source: Census Bureau.
- Construction worker payroll as a share of all payroll, 2022: 69.8 percent. Source: calculated.
- Employees 2022: 1,169,692; revenue per employee $254,434 (2017: $201,994). Source: calculated.
- Value added 2022: $175.9 billion, $150,397 per employee. Source: Census Bureau.
- Capital expenditure 2022: $3.2 billion, 1.1 percent of revenue. Source: Census Bureau.
- Highest revenue per employee by state: Hawaii $321,206; lowest: New Mexico $189,203. Source: calculated.
By state
| State | Revenue per employee | Materials share | Payroll share |
|---|---|---|---|
| Hawaii | $321,206 | 34.3% | 24.2% |
| Massachusetts | $318,920 | 32.9% | 25.8% |
| Illinois | $302,661 | 29.9% | 26.0% |
| Georgia | $292,384 | 31.2% | 21.6% |
| Washington | $292,234 | 30.3% | 29.0% |
| District of Columbia | $292,025 | 25.4% | 21.6% |
| Maryland | $284,798 | 25.6% | 26.0% |
| Minnesota | $284,600 | 34.2% | 26.6% |
| New Jersey | $279,007 | 31.6% | 26.4% |
| Oregon | $275,278 | 26.1% | 29.3% |
| Alaska | $271,758 | 32.3% | 28.0% |
| New York | $270,929 | 30.0% | 27.1% |
| Wisconsin | $265,889 | 32.6% | 27.9% |
| Indiana | $265,148 | 31.2% | 26.8% |
| Connecticut | $264,587 | 32.4% | 29.2% |
| Missouri | $263,951 | 33.5% | 27.1% |
| Pennsylvania | $262,309 | 29.7% | 27.8% |
| Rhode Island | $262,068 | 32.2% | 27.9% |
| Utah | $261,944 | 35.3% | 24.4% |
| California | $258,940 | 30.0% | 29.0% |
| Colorado | $257,579 | 30.5% | 27.6% |
| Maine | $255,466 | 34.6% | 24.2% |
| North Dakota | $255,273 | 37.9% | 26.6% |
| Ohio | $253,419 | 30.0% | 26.8% |
| Montana | $251,045 | 34.9% | 25.0% |
| Michigan | $249,783 | 32.5% | 27.9% |
| Nebraska | $249,471 | 34.4% | 26.2% |
| South Carolina | $249,012 | 28.9% | 24.7% |
| Texas | $248,846 | 31.7% | 26.2% |
| Nevada | $246,694 | 34.2% | 27.2% |
| Virginia | $242,804 | 33.8% | 27.3% |
| New Hampshire | $238,881 | 31.9% | 30.4% |
| Iowa | $237,481 | 34.2% | 28.1% |
| Arizona | $233,001 | 34.0% | 29.4% |
| Delaware | $230,767 | 31.1% | 27.6% |
| Kansas | $230,551 | 32.1% | 27.8% |
| North Carolina | $228,127 | 33.2% | 26.7% |
| South Dakota | $226,785 | 40.6% | 25.9% |
| Vermont | $225,018 | 32.9% | 28.1% |
| Tennessee | $224,779 | 31.5% | 27.0% |
| Mississippi | $223,053 | 35.2% | 25.6% |
| Louisiana | $222,217 | 33.0% | 26.1% |
| Wyoming | $220,942 | 34.2% | 27.0% |
| Idaho | $218,269 | 32.7% | 26.2% |
| Arkansas | $217,040 | 35.5% | 25.6% |
| Alabama | $215,536 | 31.7% | 26.8% |
| Kentucky | $214,585 | 31.8% | 28.2% |
| Florida | $214,101 | 32.3% | 26.9% |
| West Virginia | $208,982 | 34.2% | 26.2% |
| Oklahoma | $204,360 | 34.2% | 26.4% |
| New Mexico | $189,203 | 34.2% | 29.0% |
What the numbers imply
Labour’s share fell while revenue per worker rose
Formula. Payroll and benefits as a share of revenue, and revenue per employee, 2017 against 2022.
Calculation. Payroll plus benefits: 38.5 cents (2017) to 34.9 cents (2022). Revenue per employee: $201,994 to $254,434, +26.0 percent.
Finding. Contractors billed more per worker in 2022 than in 2017 and spent a smaller share of revenue on labour, consistent with prices rising faster than wages over the period.
Limitations. Nominal dollars; part of the revenue-per-worker rise is inflation.
What’s left is about a quarter, before overhead
Formula. Revenue minus materials, subcontracts, energy, payroll and benefits.
Calculation. $72.0 billion, 24.2 percent of revenue.
Finding. That remainder has to cover rent, vehicles, insurance, depreciation, office costs, interest and taxes before any profit. The Economic Census does not publish operating profit for construction, so trade benchmarks that quote net margins cannot be checked against it.
Limitations. Not every cost category is collected; treat the remainder as an upper bound on overhead plus profit.
Figures worth quoting
- Materials and parts: 31 cents of each plumbing/HVAC revenue dollar (2022).
- Payroll: 27 cents; benefits and payroll taxes 8.
- Revenue per employee: $254,434.
Download the data
Revenue, materials, subcontracts, energy, payroll, benefits, value added, employees and firms. Published under a Creative Commons Attribution 4.0 licence. Attribution: The Plumbing Brief.
Plumbing/HVAC contractor cost structure, 2017 and 2022, with state 2022 values (CSV)
How this report was built
Methodology
Source. US Census Bureau, 2022 Economic Census and 2017 Economic Census, files downloaded from www2.census.gov on 4 October 2026. Basic statistics tables EC2223BASIC and EC1723BASIC for NAICS 238220, US and states: RCPTOT, CSTMPRT (materials, parts and supplies), CSTSCNT (construction work subcontracted out), CSTEFT (energy and fuels), PAYANN, BENEFIT, PAYANCW, VALADD, CEXTOT, EMP, FIRM.
Derived figures. Shares, growth rates, per-firm and per-employee values are calculated by The Plumbing Brief from the published tables.
Retrieval date. 4 October 2026.
Data limitations
- The Economic Census counts employer establishments only. Businesses with no employees are covered by Nonemployer Statistics, reported separately.
- NAICS 238220 combines plumbing, heating and air-conditioning contractors. The kind-of-business split classifies each establishment by its primary activity; a plumbing-primary shop’s HVAC work is counted as plumbing-contractor revenue and vice versa.
- The Economic Census runs every five years. 2022 is the latest; 2027 results will follow around 2029.
- Revenue figures are nominal dollars. Inflation adjustments use the CPI-U annual average and are approximate for an industry whose input costs moved differently.
- Benefits include employer payroll taxes and fringe benefits as reported.
- Operating profit is not collected for construction in the Economic Census.
Source quality ranking
Tier 1. US Census Bureau, 2022 Economic Census (construction sector files EC2223KOB, EC2223BASIC and the firm-size and product-line datasets ECNSIZE2022 and ECNNAPCSIND2022) and the 2017 Economic Census equivalents, downloaded from www2.census.gov.
Tier 2. None used. Tier 3. None used.
Excluded. Paid market-research estimates of plumbing industry size, which do not publish their method and differ widely from one another.
Briefing note
US plumbing, heating and air-conditioning contractors spent 31.5 percent of their $297.6 billion in 2022 revenue on materials, parts and supplies, 27.0 percent on payroll and 7.9 percent on benefits, according to the Census Bureau’s 2022 Economic Census analysed by The Plumbing Brief. Revenue per employee rose to $254,434 from $201,994 in 2017 while payroll fell as a share of revenue.
How reporters could frame this
- Where your plumber’s bill actually goes
- A third of every plumbing dollar is materials
- Plumbing contractors billed more per worker and spent less on labour
- The census cost structure of the plumbing trade
Related questions
What percentage of plumbing revenue goes to materials? 31.5 percent in 2022 for plumbing, heating and AC contractors (Census Bureau).
What percentage goes to labour? Payroll 27.0 percent plus benefits and payroll taxes 7.9 percent.
What is revenue per employee for a plumbing company? $254,434 across the industry in 2022.
What profit margin do plumbing companies make? The Economic Census does not measure profit for construction. After materials, subcontracts, energy and labour, about a quarter of revenue remains for all other costs and profit.
Does this separate plumbing from HVAC? No. The basic statistics cover NAICS 238220 as a whole.
How to cite this report
The Plumbing Brief, “Plumbing Contractor Cost Structure: Where Each Revenue Dollar Goes”, https://theplumbingbrief.com/plumbing-contractor-cost-structure/, accessed [date].
Last reviewed: 2026-10-04.
