Labor costs

Know what the week costs before you publish it.

Add pay rates once, and Shift Amp estimates the cost of each shift and the whole week as you build. After timesheets are approved, see scheduled and actual cost side by side.

Try for free

Free for your whole team. No credit card required.

  • Cost updates as you move a shift
  • Weekly hours limits while the week is still a draft
  • Free for your whole team
A week of shifts priced as it is built in Shift Amp, with cost per day and labor as a percentage of sales

What you can do

Get the most out of your largest expense.

Labor cost is easy to review after the fact and hard to change after the fact. All four of these happen while the schedule is still a draft.

Price the schedule as you build it

Assign a wage to each employee or position and the grid starts costing itself. You are making the trade-off with the number in front of you.

  • Assign wages to employee profiles or to positions
  • See what each shift costs the moment you place it
  • Watch the margin per shift, not just the weekly total
  • Adjust before the schedule is published, not after
A shift being priced as it is placed — 8.0 hours at $19.50 for $156.00, a day total of $842 and a week total of $6,914, with an amber note that the shift puts Marcus at 41.3 hours.

Why it helps

Take control of your cost of labor.

Calculate as you go

The cost of a shift appears the moment you place it, so the week is priced while you can still change your mind about it.

Head off overtime

A weekly hours limit flags long weeks while the schedule is still a draft, which is the only point where fixing it is free.

Scheduled vs. actual

Once timesheets are approved, see the scheduled cost next to the actual cost.

Compared to

Against finding out at payroll.

Most teams cost their labor once a period, in arrears, from a report. By then every decision has already been made.

What you getShift AmpFree, or $2 per billable member for ProSpreadsheet + payroll report
Cost visible while scheduling
Long weeks flagged before you publish
Budget per shift and per locationIf you build it yourself
Alerts when the week goes over
Labor compared against salesA manual join
Wage changes reflected everywhereWherever you remember
Hours imported from the time clock

What actually counts as a labor cost.

For business purposes, labor cost is everything you pay out to have people working, not just the rate on the offer letter.

  • Hourly wages
  • Salaried wages
  • Payroll taxes
  • Overtime
  • Health care
  • Bonuses
  • Sick days
  • Vacation days
  • Insurance
  • Benefits
  • Meals
  • Supplies
  • Training costs

Plenty of managers count only hourly and salaried wages. That is a costly mistake, and it is the reason a schedule that looks affordable on the grid is not affordable on the books.

Why the number matters.

Labor costs can average 30 to 35 percent of a business's total revenue, and in some cases considerably more. They also feed prime cost, which is one of the clearest efficiency metrics you have. Whatever your business spends, it is a large amount of money leaving every year, and without control of it your margin quietly absorbs the difference.

How to calculate it.

The math is straightforward once the expenses are assembled. Assembling them is the slow part. Take a full-time employee paid $13 an hour.

  • Gross pay: $13 per hour across 2,080 hours is $27,040.
  • Net hours worked: subtract the time actually lost. Ten days of holidays, vacation and illness is 80 hours, which leaves 2,000.
  • Other annual costs: insurance, taxes, overtime and benefits for this employee come to $4,000, so annual payroll labor cost is $31,040.
  • Actual hourly labor cost: $31,040 divided by 2,000 net hours is $15.52 per hour.

So the person you think of as a $13-an-hour employee costs $15.52 for every hour of actual work. That gap is why scheduling against the wage alone understates what the week really costs.

Bringing it down without cutting pay.

Bringing labor cost down doesn't mean paying your team less. There are better levers, and most of them are scheduling decisions.

  • Plan the schedule a month in advance.
  • Tabulate the cost as you schedule rather than after.
  • Use a rotating shift so the load is spread evenly.
  • Cross-train so anyone can fill in at other positions.
  • Set clear clock-in and clock-out rules and hold to them.
  • Reduce absenteeism.
  • Reduce turnover, which carries hiring and training costs with it.
  • Watch the trend over time instead of a single period.

Every one of those gets easier when the cost is visible while you are still building the schedule, rather than in a report you read two weeks later.

FAQ

Labor costs, answered.

What counts as a labor cost?

Everything you pay to have people working, not just the hourly or salaried wage. Payroll taxes, overtime, health care, bonuses, sick days, vacation days, insurance, benefits, meals, supplies and training all belong in the number. Counting only wages is the most common way businesses underestimate what a schedule costs them.

Why do labor costs matter so much?

Because they are usually the largest cost a business controls. “Why the number matters” above covers the share of revenue and what it means for prime cost.

How do I track labor costs?

It comes down to record keeping and reporting, which is what the software is for. Shift Amp imports hours automatically once your team clocks in and out, applies the wages you have set, and lets you calculate and track cost over whatever period you want to look at.

Does Shift Amp calculate overtime?

No. Shift Amp doesn't calculate pay. You can set a weekly hours limit, though, and anyone scheduled past it is flagged before the week goes out.

Can I compare labor against sales?

Yes. You can view historical and projected sales revenue next to your labor cost, track labor as a percentage of sales, and see when labor is running ahead of the revenue it is supporting.

Can I set different budgets for different locations?

Yes. Budgets are set per shift and per location, so a quiet site and a flagship site can each be measured against a number that makes sense for them.

What does it cost?

Live cost estimates come free with scheduling, for your whole team. Scheduled versus actual cost, labor reports and location comparisons are part of Pro, at $2 per billable member a month, and every new team starts with 14 days of everything free.

Why Shift Amp?

Because we save you time and money. Scheduling is free for your whole team, and Pro is $2 per billable member a month when you want the time clock and reports. We do what we say we'll do, and we'll never waste your time trying to upsell you.

Pricing

All the schedule. None of the bloat.

No add-ons, no per-location fees, no surprises. Just a schedule your whole team can count on, and it's free for all of them.

Free

$0a month

For any number of people.

  • The schedule, with open shifts, shift swaps and coverage
  • Availability and time-off requests
  • Labor cost estimates as you build the week
  • Messaging with photos and documents, and shift tasks
  • iOS and Android apps for everyone on the team
  • No credit card
Start free
14 days free, no card

Pro

$2per billable member a month

Every member counts, from the first. No cap on team size.

  • Everything in Free, plus:
  • A time clock on phones and shared kiosks, with location checks
  • Timesheets and approvals
  • Payroll-ready exports
  • Reports on hours, coverage, labor cost and attendance
  • Paid time off balances
  • A wiki for your team's how-tos
Try 14 days free

Find out what next week costs.

Start free, add your wages, and price your first schedule before you publish it.

Try for free

Free for your whole team. No credit card required.