Billable Utilization Calculator

How it works

Billable utilization is the share of available hours that were billed to clients: billable hours divided by available hours. It works the same for one person or a team, as long as both totals cover the same people and the same period. Firms define available hours differently, either as hours actually available after holidays and time off or as a fixed standard such as 40 hours a week; with a fixed standard, utilization can exceed 100%.

Revenue from billable hours is billable hours times the billing rate. Revenue at the target utilization is what the same available hours would bring if the target share of them were billed, so the gap shows the revenue the difference in utilization represents.

The loaded cost of an available hour (wages, payroll taxes, benefits and overhead spread over available hours) has to be paid whether or not the hour is billed. Billed hours cover it once billable hours × rate reaches available hours × loaded cost, so the break-even utilization is the loaded cost divided by the billing rate. SPI Research's 2026 benchmark put average professional-services utilization at 66.4% in 2025, against the 75% it considers optimal.

Formula

utilization            = billable hours ÷ available hours
billable revenue       = billable hours × billing rate
revenue at target      = available hours × target utilization × billing rate
loaded cost            = available hours × loaded cost per hour
break-even utilization = loaded cost per hour ÷ billing rate
break-even hours       = available hours × break-even utilization

Example

A week with 30 billable hours out of 40 recorded is 30 ÷ 40 = 75% utilization; 32 billable hours in a fixed 40-hour week is 80%, and 50 is 125%.

A consultant with 1,200 billable hours out of 1,800 available is at 66.7%. At $150 an hour those hours bring $180,000; at the 75% target the same 1,800 hours would bring $202,500, a gap of $22,500. At a loaded cost of $85 per available hour the hours cost $153,000, so break-even utilization is $85 ÷ $150 = 56.7% (1,020 billable hours) and the consultant covers loaded cost by $27,000, 10 points above break-even.

Assumptions and limitations

• Results are for informational and educational purposes and are not financial, accounting or business advice.
• Every billable hour is assumed to be billed and collected at the one rate entered. Write-downs, discounts, fixed-fee work and unpaid invoices lower realized revenue.
• The loaded cost per available hour is an input you supply and is treated as fixed for the period; its default is illustrative.
• The 75% target default and the 66.4% average are SPI Research survey figures for professional-services firms (2026 report, 2025 data), not standards; suitable levels differ by role, firm and industry.

Frequently asked questions