Total cost
Every item in a work area (labor, materials, subcontractors and so on) has a total cost. You can see it in the list of items. An item's total cost is:
the cost of the item itself, plus
tax, if tax applies, plus
any overhead recovered on that item.
Add up the items and you get the work area's total cost. This is why a work area's total cost is usually higher than any single piece of it, such as the labor line. The total includes everything that goes into the work area, not just the labor.
The breakdown under the work area price
Under the work area price, you'll see a short breakdown:
Estimated cost: what the work is expected to cost you.
Break-even: the price where you cover your costs, with no profit.
Net profit: what's left over at the price you've set.
Where your labor rate comes from
The hourly labor rate your customers are charged is built from three things:
your average wage cost,
plus your overhead recovery,
plus your profit.
So it is not just what you pay your crew. It's what you need to charge to cover wages, overhead and profit.
Changing the rate
If you set a Custom Price on a labor item in your Item Catalog, that price overrides the built-in rate for that item. Use it only when you want to charge a different amount than your budget numbers produce.