Billable Utilization Calculator
What share of paid hours are billable, what that yields in revenue, and how much a few points of utilisation is worth.
Utilisation is billable hours over available hours.
How the billable utilization calculator works
Utilisation is billable hours over available hours. In an agency it is the single most watched number, because revenue is utilisation times rate times headcount and the other two move slowly.
A point of utilisation across a team is worth far more than it sounds: at ten people on 1,800 hours at 150 an hour, one percentage point is 27,000 a year. That is why the number is watched, and also why chasing it past about 80% burns people out.
Formula: utilisation = billable hours / available hours
Worked examples
| Inputs | Utilisation | Note |
|---|---|---|
| 1,150 of 1,800 hours | 63.89% | 63.9% — below target |
| At target | 75% | 75% |
| Overloaded | 90% | 90% — not sustainable |
FAQFrequently asked questions
What utilisation should an agency target?
Seventy to eighty per cent for delivery staff. Above 85% there is no room for training, sales or the next project starting late.
Why is cost charged on available hours?
Because you pay for them whether they are billed or not. That is what makes idle capacity expensive and why the bench shows up in the contribution line.
What is the break-even utilisation?
Cost per hour divided by billing rate. Below it a person costs more than they bring in, regardless of how good they are.
Does higher utilisation always mean more profit?
No. Past about 85% quality falls, people leave, and the replacement cost exceeds the extra billing. It is a curve, not a line.
Should non-billable work count as available?
Yes — internal projects, training and sales are real hours you pay for. Excluding them flatters the number and hides the cost.
Where these figures come from
- Corporate Finance Institute — EBITDA — why EBITDA is a non-GAAP measure with no single definition
- US SEC — Non-GAAP Financial Measures, Compliance & Disclosure Interpretations — the disclosure rules that exist precisely because EBITDA is not standardised
- Australian Securities and Investments Commission — the Australian corporate regulator
Last checked: September 2026. These are standard management-accounting definitions; where a term has no single agreed definition, the page says so.