Labor cost percentage calculator.

How the calculation works

Use the same dates and payroll accrual basis as the sales report. A payroll payment date may not match the period in which the hours were worked.

Formula: Labor cost ÷ sales × 100.

Worked example

The starting inputs are illustrative assumptions: Wages, salaries and benefits ($): 14600; Net sales ($): 40000. They produce 36.50%. These inputs are editable and are not market prices or industry benchmarks.

Use the result

Compare equivalent business formats and labor definitions. Owner labor, employer taxes and benefits can make a superficially similar ratio incomparable.

Keep the period, unit and currency consistent across the inputs. A calculator cannot identify a missing cost from the figures you provide. Retain an invoice or stock-count record for the inputs, and use the result as a check on your operating decision.