Ask a services firm what an hour of its consultants costs and you will usually get a number someone typed into a tool years ago. In the October 2026 benchmark we ran on seven competitors, BigTime’s default cost rate is zero, Teamwork.com keeps one site-wide rate per user, and Productive divides salary by hours without employer taxes or benefits. Margins built on those rates are estimates, not measurements.
Start from the contract
Take Hannah Goldstein, a Senior Consultant at Mesabrook Advisory, our US demo company in Austin. Her contract says $108,000 a year, salaried exempt. Her company’s charges template adds what Mesabrook pays on top: Social Security at 6.2% up to $176,100, Medicare at 1.45%, federal unemployment at 0.6% of the first $7,000, and Texas unemployment at 2.7% of the first $9,000. That brings her loaded pay to $116,547.
Divide by the hours she can work
Hannah does not work 2,080 hours a year. She works 220 days a year once Mesabrook’s holidays are taken out, minus her 15 days of paid time off: 1,640 productive hours. Her pay alone costs $71.07 an hour.
Hannah GoldsteinSenior Consultant · Austin, TXSalaried exemptAdd her share of what keeps the lights on
Rent, software, finance and HR don’t bill clients, but they are part of the cost of every hour Hannah sells. Spread onto her team, Transformation and Change Management, they add $17.60 an hour in November. Her loaded cost is $88.67 an hour, and that is the number stamped on each hour she logs: 7.5 hours on Lone Star on November 3 cost $665.03.
Why it matters
At $88.67, a day rate of $850 still leaves a healthy margin. On a fixed-price engagement that runs 95 days over plan, it does not. Lone Star, sold at 28.0%, is heading for −9.7% at completion. You can only see that if each hour carries its actual cost, updated automatically when a salary changes.