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How to Calculate Resource Utilization

What is Resource Utilization?

Measures percentage of available work time actually spent on billable or productive work. Identifies capacity gaps and scheduling inefficiency.

Step-by-Step Guide

  1. 1Track billable/productive hours per resource
  2. 2Divide by total available hours
  3. 3Calculate: (productive hours ÷ available hours) × 100%
  4. 4Benchmark against industry standards

Worked Examples

Input
1600 avail, 1400
Result
87.5%

Common Mistakes to Avoid

  • Targeting 100% utilization (leaving no flexibility)
  • Not accounting for required non-billable time

Frequently Asked Questions

What utilization rate is healthy?

Service firms target 70-85%; some waste (5-15%) is normal for training, admin, and context switching.

How do I improve utilization?

Better project scheduling, reduce context switching, build resource pools, optimize allocation.

Ready to calculate? Try the free Resource Utilization Calculator

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