What is Welding Economics: Why Labor Dominates Every Cost Estimate?
Mathematical Foundation
Laws & Principles
- Operating Factor (Arc-On Time): SMAW (Stick) = 15-20%. GMAW (MIG) = 40-50%. Robotic MIG/MAG = 80-90%. This single variable dominates the entire cost equation.
- SMAW Has 60% Yield: A 50 lb box of stick electrodes produces only ~30 lbs of actual weld metal. The rest is flux coating, stub ends, and spatter waste.
- MIG Has 95% Yield: Solid wire MIG has virtually zero waste — no slag, no stubs, minimal spatter. FCAW dual-shield is ~85% due to slag.
- Deposition Rate Is Process-Dependent: Stick: 3-5 lbs/hr. MIG short-circuit: 5-8 lbs/hr. MIG spray: 10-15 lbs/hr. SAW: 20-40 lbs/hr.
- Use Burdened Labor Rate: Include overhead (electricity, insurance, rent, benefits) — not just the welder's hourly wage. A $28/hr welder often has a $55-70/hr burdened rate.
Step-by-Step Example Walkthrough
" Comparing Stick vs MIG labor cost at a $55/hr burdened shop rate. "
- 1. Stick: 3 lbs/hr × 20% arc time = 0.6 lbs actual weld per hour.
- 2. Stick labor cost: $55 / 0.6 = $91.67 per lb deposited.
- 3. MIG: 8 lbs/hr × 45% arc time = 3.6 lbs actual weld per hour.
- 4. MIG labor cost: $55 / 3.6 = $15.28 per lb deposited.