Effective Hourly Rate Calculator
Determines actual hourly earnings by dividing total income by total hours worked including unpaid time
Total earnings before taxes for the period
All hours worked including non-billable time
Your actual earnings per hour worked
Hourly rate projected to a standard 8-hour day
How your effective rate compares to common benchmarks
Frequently Asked Questions
What is an effective hourly rate?
Your effective hourly rate is your total income divided by your total hours worked, including unpaid time like admin, marketing, and travel. It reveals what you actually earn per hour, which is always lower than your billing rate.
Why is my effective rate lower than my billing rate?
Because you spend time on non-billable activities: proposals, invoicing, marketing, admin, professional development, and transitions between projects. If you bill at $100/hour but only 60% of your time is billable, your effective rate is $60/hour.
How do I increase my effective hourly rate?
Either increase your billing rate, reduce non-billable hours through automation and efficiency, switch to project-based pricing that rewards speed, or increase your utilization rate by reducing gaps between projects.
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