Direct Labor Costs Calculator

Calculate the direct labor costs based on hours worked, hourly wage, and productivity rate

Input Parameters

Calculation Results

Calculation Formula

Total Direct Labor Cost = (Hours Worked × Hourly Wage) × (100 / Productivity Rate)

Where:
- Hours Worked: Total number of hours worked
- Hourly Wage: Cost per hour of labor
- Productivity Rate: Efficiency percentage (100% means no waste)

Total Direct Labor Cost

$0.00

Direct Labor Costs Calculator Calculator Usage Guide

Learn how to use the Direct Labor Costs Calculator and its working principles

How to Use the Calculator

  1. Enter the total number of hours worked by the labor.
  2. Enter the hourly wage rate for the labor.
  3. Enter the productivity rate as a percentage. For example, if the labor is 90% productive, enter 90.
  4. Click the "Calculate" button to compute the total direct labor cost.
  5. The result will be displayed in the "Total Direct Labor Cost" field.

Understanding the Formula

The calculator uses the following formula to calculate the total direct labor cost:

Total Direct Labor Cost = (Hours Worked × Hourly Wage) × (100 / Productivity Rate)

This formula adjusts the labor cost based on the productivity rate, ensuring that less efficient work is appropriately accounted for in the total cost.

Example

If an employee works 40 hours at a rate of $20 per hour and is 80% productive:

  • Hours Worked = 40
  • Hourly Wage = $20
  • Productivity Rate = 80%
  • Total Direct Labor Cost = (40 × $20) × (100 / 80) = $100 × 1.25 = $125