How do you calculate utilisation rate for an agency?

You'll usually want two rates with one denominator. Total utilisation counts every hour your people log, including internal work and admin. Billable utilisation counts only the hours on work your client pays for. Comparing the two shows you how much of your team's week goes to non-client work.

Start with available hours, because that's where most spreadsheets go wrong. Take the working days in the period and multiply by the standard day. Then take out public holidays and each person's approved leave. A 22-day month on an 8-hour day gives 176 hours before anyone takes time off.

Next, total the hours your team logged in the same period. Use approved timesheets where you can. A draft sheet is a claim, and an approved one is an agreement. If you build the rate on drafts, it will move when a manager reviews them.

Then divide and multiply by 100. Here's how the sum works for a three-person team in that 22-day month. Person A has 176 available hours and logs 150 billable, so 85%. Person B took 10 days of leave, leaving 96 available hours, and logs 48 billable, so 50%. Person C has 176 available hours and logs 132 billable, so 75%.

For your team rate, add the hours first and divide once. That's 330 billable hours over 448 available, or 74%. Averaging the three percentages gives 70%, because it lets a person on leave count as much as a person who worked the full month.

Leave is the mistake that skews your rate most. If you keep Person B's 10 days in the denominator, 48 hours over 176 reads as 27%. Nothing about the work changed. That sum blames a holiday on the person who took it.

A target turns your rate into a decision. Deltek's Clarity study of architecture and engineering firms, published on 12 May 2026, found staff utilisation just under 60%. Use a figure like that as a reference, then set your own target per role, since a director and a developer carry different loads.

PeopleMuster runs this sum from the timesheets your team already fills in. Each person logs the day by project against their expected hours, and managers approve the sheets. The Utilization reporting screen shows total hours, the utilisation percentage and average daily hours together. You can break it down by project, by department or by sheet status, and send the report to Slack.

Sheet status changes how you read the figure. The PeopleMuster reports screen breaks hours down by sheet status. You can see how much of your month rests on approved sheets and how much on drafts still in the approvals queue. Projects carry a Billable or Non-Billable flag, and the capacity grid filters on it, so you can set planned billable hours beside logged ones.

Work out available hours with holidays and leave removed, sum the team's hours before dividing, and review the rate weekly on approved sheets. In PeopleMuster, approved leave comes off the capacity plan as soon as it's approved. You'll find the week-over-week trend on the same screen as the utilisation figure.