Remodel Labor vs Materials: The 2026 Split Isn't 65/35

Two homeowners remodel the same bathroom. Same scope, same midrange fixtures, same square footage. One lives in Vineland, New Jersey, the other in Santa Fe, New Mexico. Both end up paying about $26,500.

One of them spends $19,342 of that on labor. The other spends $12,669, and puts more than twice as much into materials.

Same project, same price, and a genuinely different thing being purchased. It is also the part of renovation cost that almost nobody breaks out by market, because doing it requires wage data for every metro in the country rather than one contractor’s invoice history.

So we ran it. We took construction wage data from the Bureau of Labor Statistics for 393 metro areas, applied it against local cost indexes across the 26,283 ZIP codes we track, and pulled the labor and material halves apart on all ten projects we price. When we ranked 301 US cities by remodeling cost earlier this year, the question was which markets are expensive. This one is about composition, which turns out not to follow the same map. For a bathroom remodel, the labor share lands anywhere from 46% to 74% depending on the address.

The Rule Everyone Quotes Comes From One Contractor’s Books

Search this question and you get 65/35. Labor 65%, materials 35%, with per-project variants: 67% labor on a kitchen, 69% on a bathroom, 71% on an addition, 74% on a basement.

Those numbers trace back to a design-build firm in the Portland metro publishing its own averages over seven years and roughly 300 projects. That is honest primary data and a genuinely useful thing to publish. It describes their projects, at their price point, in their labor market.

Somewhere along the way it got copied outward until it reads as a national constant. A firm doing high-end design-build work in one of the more expensive construction markets in the country is not a proxy for a midrange bathroom in Alabama, and their split was never claimed to be.

The other thing that gets lost in the copying is what counts as a material. One remodeler in the same set puts visible finish materials at a fifth to a sixth of total project cost, because plumbing rough-in, framing lumber, fasteners and waste disposal do not feel like materials to a homeowner looking at tile samples. Move that line and the ratio moves with it.

Labor Share by Project, Before Location Touches It

Start with what the work itself demands. These are the labor shares we model, and the labor dollars they represent at national median pricing.

Thirty-five points separate the top of that list from the bottom. The pattern is trade count. A bathroom needs a plumber, an electrician, a tile setter and a finish carpenter working in sequence in a room too small for two of them at once. Compare that with a garage door: one crew for half a day, plus a manufactured door that arrives on a truck.

The HVAC number is the one worth sitting with. At 65%, an HVAC replacement is the most labor-weighted project we track, and it is also the one where homeowners shop hardest on equipment brand and SEER rating. The equipment is barely a third of the invoice.

Basement finishing carries the largest absolute labor bill at $31,625, which is more than most kitchens cost in total.

Construction Wages Run 3.5 Times Across the Country

Across those 393 metros the median construction wage is $55,740. For carpenters specifically, the Bureau of Labor Statistics puts the national median at $60,580 a year, or $29.12 an hour, as of May 2025.

What the median hides is the spread. At the bottom sits Guayama, Puerto Rico at $23,130, and the top of the list reaches $82,300. Call it a 3.5x range, or 2.2x if you stay on the mainland, where Brownsville-Harlingen, Texas anchors the low end at $37,740.

The metro at the top is Chicago. Not San Jose, which comes in at $79,150, and not San Francisco at $79,000. Chicago-Naperville-Elgin pays construction labor more than any metro area in the country, which is not where anyone puts it when asked to name the expensive markets. Strong trade union density in the Chicago building trades is the likely reason, and it shows up in every quote written in Cook County.

Kokomo, Indiana is the other name that stops you. A metro of about 80,000 people in north central Indiana, 99th percentile construction wages, $80,260. Manufacturing towns with union wage floors pull skilled trades up with them.

That city ranking explained its variation with a single figure, saying labor accounts for about 45% of most project costs. Forty-five percent was our model default, standing in for all ten projects at once. The real per-project numbers are in the table above, and geography moves them further than a single default can suggest.

The Same Bill, Bought Two Different Ways

Here is the bathroom remodel run across fourteen markets, sorted by how much of the bill is labor.

Vineland and Santa Fe are the pair to look at. Total bills within $751 of each other, labor shares 27 points apart. A Vineland homeowner is buying mostly hours. In Santa Fe, mostly stuff.

Wage level alone does not settle it either. Brownsville has the lowest construction wage on the mainland and still comes out at 54% labor, while Hot Springs pays its trades more and lands at 46%. The second input is the local cost index, and it moves independently of wages. Where the two pull apart hardest, the labor share goes to extremes: Fairbanks runs a wage index of 1.47 against a local cost index of 0.84, and Fayetteville-Springdale-Rogers runs the mirror image at 0.86 and 1.49.

What This Changes About the Quote in Front of You

Knowing your labor share tells you which lever is worth pulling.

At 74% labor, material substitution is close to pointless. Downgrading tile, fixtures and vanity across a Vineland bathroom might save $1,500 on a $26,230 job while you leave $19,342 untouched. The levers that work there are scope and sequence: fewer fixtures moved, the existing plumbing wall kept, work scheduled when crews are not booked solid.

At 46% labor, the opposite. In Hot Springs, materials are $12,165 of a $22,599 project, and specification choices genuinely move the number.

This is also the half of your bill that is inflating. Home builders and remodelers shed a net 26,100 positions over twelve months while non-supervisory wages rose 9.2% in a single month, according to the Home Builders Institute construction labor market report, which puts the annual economic cost of the skilled labor shortage at $10.806 billion and about 19,000 single-family homes not built. Materials have tariff exposure and supply shocks. Labor has demographics, and demographics do not resolve in a quarter.

One practical use for the split: when two bids on the same scope come back far apart, the labor share tells you where to look first. On a bathroom in a high-wage metro, a bid that undercuts the field by 30% is not finding cheaper tile. It is finding cheaper hours, and comparing contractor quotes properly means asking which hours those are.

Where Our Own Split Falls Short

Three things about the numbers above deserve stating plainly.

The material side is the weak half. Our labor multiplier is built from BLS metro wage data, which is measured and specific. The material multiplier is inherited from the general local cost index we already had, so it reflects overall cost levels in a market rather than surveyed material prices. Honolulu is the tell: an island metro should carry a freight premium on materials, and a general cost index will not capture it cleanly.

Our per-project labor shares sit below what remodelers report, 30% to 65% against their 65% to 74%. Part of that is the definition of materials discussed earlier. The rest is project mix, since our base costs track national midrange scopes rather than design-build work. We would rather publish the lower, more conservative figure and say where it comes from.

And 7,309 of our 26,283 ZIP codes fall outside any metro area in the wage survey. Those inherit a state average, which smooths over real differences between a rural county and its nearest small city. The 18,974 ZIPs inside a metro carry the specific number.

None of those three caveats touches the useful conclusion. Ask what share of your project is labor before you start economizing, because the answer decides whether your savings live in the specification or the scope, and it is set by your address as much as by your project.