Replacing a $60,000 tradesperson costs $60,000 to $120,000

What one missed payroll actually costs:

Sources: DOL, ABC, state labor departments

Construction turnover runs 68.2% annually, with skilled trades even higher at 73.1%. A contractor who loses a journeyman electrician over a single missed payroll may not find a replacement for months. The industry needs 439,000 additional workers in 2025, projected to hit 499,000 in 2026. 94% of firms report difficulty filling positions. 41% of the current workforce will retire by 2031. Every skilled worker you have is functionally irreplaceable right now.

Skilled trades workers are among the hardest employees to replace in any industry. According to BLS data, median wages run $50,000 to $63,000 per year depending on the trade.

Source: BLS Occupational Employment and Wage Statistics, May 2024

An 8-employee electrical shop at $55,000 average salary runs about $36,667 per month in base wages. Add the payroll burden (FICA, unemployment taxes, workers comp at 5 to 7% for electrical, health insurance) at 30 to 45%, and total monthly labor cost hits $48,000 to $53,000.

Why payroll gaps happen in trades (it's usually not mismanagement):

• GC payment delays. General contractors pay subs on net-30, net-60, or net-90 terms. Work is done, but money hasn't arrived.
• Weather stops. 45% of construction projects are affected by weather. 60% face weather-related delays. Work stops, payroll doesn't.
• Change order disputes. Work completed but payment held pending approval.
• Retainage. 5 to 10% of contract value held until project completion, which can be months or years away.
• Seasonal revenue swings. HVAC companies can see 50 to 75% revenue drops in shoulder months.

These are structural problems in the trades business model. They happen to well-run operations.

The math on payroll funding:

A same-day advance on $15,000 at a 1.25 factor rate costs $3,750 in fees. Losing two skilled workers over missed pay costs $120,000 to $240,000 in replacement costs alone, plus the jobs you can't complete without them. The cost of covering the gap is a fraction of the cost of not covering it.

Every skilled tradesperson is a six-figure asset right now:

With 439,000 unfilled positions industry-wide and 73% turnover in skilled trades, every journeyman or master tradesperson on your crew is irreplaceable for months if they walk. Bridge funding to make payroll on time keeps that team intact through the cash flow rough spots that come from GC delays and weather stops. Hit trades payroll bridge funding, or get on the application.