What does an hour of your team's time really cost?
Pay is only part of it. Here's the simple math we use, and how to use it to decide what's worth automating.
Most owners think of an hour of work in terms of the hourly wage. The real cost is higher, because pay is only part of what you spend to have someone at work. Knowing the true figure makes it much easier to judge a new tool, a hire or a process change.
Start with pay, then add the extras
On top of pay, Canadian employers cover CPP contributions, EI premiums, vacation pay and statutory holidays, and often benefits, software, equipment and space. A common rule of thumb is to add about 30% on top of pay. We use that figure in our scan.
Then count the hours people actually work
A full-time year is 52 weeks of 37.5 hours, or 1,950 hours. Take away vacation, statutory holidays and sick days, and the hours actually worked land closer to 1,785. That's about 47.6 working weeks.
What that means for admin
Say your team spends 20 hours a week on tasks that tools could take over. That's 20 hours × $49.16 × 47.6 weeks, or about $46,800 a year.
Use it to make better calls
Now compare. A $100 a month tool that saves three hours a week costs $1,200 a year and gives back about $7,000 worth of time. That's an easy yes. A tool that saves 20 minutes a week at the same price is harder to justify.
Saved hours only create value if they go somewhere useful. Before you automate, decide where the time will go: more sales calls, faster service, or fewer late nights.
The free Time Dividend Scan does this math for your business automatically, with your team size and pay range.