Calculate your billable utilization rate
Utilization is the share of your working time that ends up on an invoice. The rest goes on admin, sales, learning and unpaid revisions. It matters for pricing: the lower your utilization, the more each billed hour has to earn to cover the hours that aren't billed.
Result
- Billable hours120 h
- Available hours160 h
- Utilization75%
- Non-billable time40 h (25%)
About 7.5 of every 10 working hours end up on an invoice.
Formula and assumptions
Utilization % = billable hours ÷ available hours × 100
- Available hours are the hours you intend to work, excluding holidays and leave.
- Billable hours are hours invoiced to clients, whether hourly or within fixed-price work.
Worked example
A consultant worked 160 hours last month and billed 120 of them.
- Utilization: 120 ÷ 160 = 0.75 = 75%
- Non-billable time: 160 − 120 = 40 hours
She is 75% utilized. Ten hours a week went on proposals, email and bookkeeping — a healthy share for someone who also wins her own work.
The example uses round numbers in no particular currency. They are the values the calculator loads with.
What the inputs mean
- Available hours
- The hours you intended to work in the period, not counting holidays or leave.
- Billable hours
- Hours charged to a client, either directly or as part of fixed-price work.
- Non-billable hours
- Working time no one pays for directly: sales, admin, learning, internal projects.
Common mistakes
- Using total hours in the month (including weekends) as available hours.
- Treating 100% as the goal. Without non-billable time there is no time to find the next client.
- Estimating billable hours from memory rather than from time records.
Limitations
- Measures time, not money. Two people with the same utilization can earn very different amounts.
- One period can be unusual; look at several months together.
Results are estimates based on the numbers you enter. They are not tax, legal or accounting advice. Read the disclaimer.
Questions
What is a good utilization rate?
There's no universal figure. Solo freelancers who find their own work often sit between 50% and 75%; people in agencies with dedicated sales staff are often expected to bill more. Watch your own trend over time.
Why does the calculator stop me from billing more than my available hours?
Usually that means a typo. If you really did work overtime, tick “allow overtime” and the calculator will show utilization above 100%.
How does utilization affect my rate?
Multiply your available hours by your utilization to get billable hours, then use that in the hourly rate calculator. Lower utilization means fewer billable hours and a higher required rate.