Billable Utilization Rate Calculator
Measure what share of your working hours are actually billable — the core productivity metric for agencies, consultants and freelancers.
How it works
Utilization % = billable hours ÷ total available hours × 100 · Effective rate = billable hours × rate ÷ available hours
Utilization is the share of your paid working time that you can actually invoice. Admin, sales, training and downtime all eat into it, so even fully booked professionals rarely bill 100%. Many agencies target 70–85%; the effective rate shows what you earn per available hour once non-billable time is factored back in, which is often far below the headline billable rate.
Worked example
A consultant works 40 hours in a week but bills only 30 of them at $100 an hour. Utilization is 30 ÷ 40 = 75%. That produces $3,000 of revenue, so the effective rate across all 40 hours is 3,000 ÷ 40 = $75 per hour.
Frequently asked questions
What is a good utilization rate?
Most professional-services firms aim for 70–85%. Below that, too much time is going to non-billable work; consistently above 90% often signals burnout or no time left for business development.
Why is my effective rate lower than my billable rate?
Because you cannot bill every hour you work. Time spent on admin, proposals and downtime is unpaid, so spreading your revenue over all available hours gives a lower effective rate than the sticker rate you charge clients.
Should time off count as available hours?
No. Utilization measures working time, so exclude vacation, holidays and sick days from the available-hours figure to keep the ratio meaningful.
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Educational estimate, not financial advice.