How Much Do Remodeling Contractors Make: Wages, Margins and Owner Income by the Numbers

The Bureau of Labor Statistics publishes wage data every May for every construction trade. These are W2 employee wages, not business owner income. The median annual wage for a plumber, pipefitter or steamfitter is $63,800 ⁴. The median for a carpenter is $60,580 ³. If you employ tradespeople, this is the labor market you are competing in.

These are median figures. Half earn more, half earn less. Location matters. Union vs nonunion matters. Experience matters. But the medians tell you what it costs to hire and keep people in each trade. If you are paying well below these numbers, you will lose people. If your bids do not cover these wages plus burden, you are subsidizing every job out of your own pocket.

Trade wages tell you what employees earn. If you own a remodeling company, your income comes from two places: the salary you pay yourself (which NAHB counts as an operating expense) and the net profit left after everything else is paid.

On average, residential remodelers reported $2.7 million in total revenue for fiscal year 2024 ¹. Of that, about $1.9 million (70.1%) was spent on cost of sales: labor, materials and contractors ¹. Operating expenses including indirect construction costs, finance, sales and marketing, general and administrative costs and owner's compensation cost remodelers an average of $646,000 (23.6% of revenue) ¹. That left an average net profit margin of 6.3% ¹.

That 6.3% net margin is what the business kept after paying the owner a salary. The owner's actual total income is higher because their compensation is inside that $646,000 operating expense number ¹. NAHB does not break out the owner pay line separately in the public summary, so total owner income is the salary they set for themselves plus whatever net profit the business produces.

Averages hide a brutal spread. The top 25% of firms averaged $493,000 in net profit, an 18.4% net profit margin ². The bottom 25% ran at a loss ². That is not a small difference in outcome. Two firms doing the same size jobs in the same market can end up hundreds of thousands of dollars apart at the end of the year.

The difference is not just pricing. NAHB data shows that the most profitable remodelers concentrate almost entirely on residential remodeling ². The bottom quartile tends to spread across single family construction, commercial and remodeling work ². Specialization correlates with profitability in this data.

This means the answer to how much do remodeling contractors make is not one number. It is a range. A focused, well run firm doing $2.7 million in revenue can produce $493,000 in net profit on top of owner salary ¹². A firm of the same size that does not control overhead and scope can lose money while working just as hard.

BLS wage data covers employees. It does not include self employed contractors, and construction has far more of them than most industries. A self employed electrical contractor running a crew does not show up in the electrician wage data at all.

The median for carpenters is $60,580 ³. For plumbers it is $63,800 ⁴. Those numbers describe what a W2 employee earns. The owner of a remodeling company who started as a carpenter and now runs millions through the business has an income that has nothing to do with the carpenter median. That number is about the labor market for hiring, not about what a business owner takes home.

When you read BLS wage data, use it for what it is: the going rate for the people you hire. Your income as an owner is a function of revenue, margin and overhead control. Those are NAHB numbers, not BLS numbers.

Most contractors know their revenue. Fewer know their actual margin. Here is how to calculate what your business is actually paying you.

• Pull your total revenue for the last 12 months.
• Add up every dollar that went to materials, crew labor (burdened: wages plus payroll taxes, workers comp and benefits) and subcontractor invoices. That is your cost of sales.
• Subtract cost of sales from revenue. That is your gross profit.
• Add up every other expense: rent, insurance, vehicles, office, marketing, your own salary. That is your overhead.
• Subtract overhead from gross profit. What remains is your net profit.
• Your total income from the business is the salary you paid yourself plus that net profit number.

At the NAHB average gross margin of 29.9%, a remodeling company keeps about thirty cents of every dollar after paying for the job itself ¹. But operating expenses eat most of that. The average net margin of 6.3% means six cents on the dollar actually survives to profit ¹.

The top 25% of firms keep 18.4% net ². That is nearly three times the average. They do not get there by charging three times as much. They get there by running tighter overhead, specializing in residential remodeling, and knowing which jobs are worth their time before they commit to an estimate.

Every inquiry that turns into a wasted site visit is money off your net margin. Knowing what a homeowner actually wants and can spend before you drive out is one of the simplest ways to protect the margin you have.

1. Remodelers Saw Profit Margin Gains in 2024, NAHB Eye on Housing
2. The $651,000 Gap: What Separates Top Remodelers From The Rest, Pro Remodeler
3. Carpenter Salary: $60,580 Median, by State, NueCareer
4. Plumber Salary: $63,800 Median, by State, NueCareer

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