How do you calculate downtime cost per hour?

Add lost production revenue per hour, direct labor waste per hour, and scrap, restart, and overhead per hour, scaled by the hours basis. On a one-hour basis with $8,500, $900, and $1,800, the cost is $11,200 per hour.

What should be included in downtime cost?

Forfeited revenue or margin on lost output, the wages of idled staff, and the scrap, restart, and fixed overhead absorbed with no production. Here those are $8,500, $900, and $1,800, summing to $11,200.

Why use a one-hour basis?

A one-hour basis gives a clean per-hour loss you can drop directly into payback calculations and criticality rankings. Set the basis to the actual outage length when you want the total cost of a specific event instead.

What is a good downtime cost per hour?

There is no universal good number - it depends on line value. The point is accuracy: an $11,200/hr figure justifies far more reliability spend than a guessed $2,000/hr, so undervaluing it leads to chronic under-maintenance.

Lost revenue vs total downtime cost - what is the difference?

Lost revenue, $8,500 here, is only the forfeited sales or margin. Total cost adds $2,700 of labor, scrap, and overhead to reach $11,200, capturing costs that accrue even when nothing is being produced.

How do I use this to justify reliability spending?

Multiply the hourly cost by expected annual downtime hours to get yearly exposure, then compare against the cost of the monitoring, spares, or redundancy that reduces it. An $11,200/hr line losing 50 hours a year carries $560,000 of exposure.

Maintenance & Reliability calculator

Downtime Cost per Hour Calculator

Downtime cost per hour is the total dollar loss an unplanned line stoppage inflicts for every hour it runs, blending lost production revenue with the labor, scrap, and fixed overhead that keep accruing. Maintenance and reliability engineers use it as a single decision figure to justify spares stocking, predictive monitoring, and redundancy. It matters because almost every reliability investment is weighed against the cost of the downtime it prevents, and an undervalued hourly figure leads to chronic under-maintenance. Stated per hour, the number drops straight into payback math and criticality rankings.

What this calculator does

Calculate the hourly cost of unplanned downtime from lost production, labor waste, scrap, and continuing overhead.
Use it when a reliability engineer needs a defensible hourly loss rate for bad-actor ranking, root cause analysis (RCA), or capital justification.
It sums lost production revenue per hour, direct labor waste per hour, and scrap, restart, and fixed overhead per hour, scaled by the downtime hours basis, to give cost per downtime hour.

Formula used

Downtime cost per hour = downtime hours basis × lost production revenue per hour + direct labor waste per hour + scrap, restart, and fixed overhead per hour
Use a one-hour basis when you want a direct hourly loss figure for decision making

Inputs explained

Downtime hours basis: Use 1 hour for a direct hourly estimate, or enter another basis if you want a scaled rate.
Lost production revenue per hour: Use throughput contribution or margin lost when the line is constrained and down.
Direct labor waste per hour: Include operators, mechanics, and support labor that remain paid during the stop.
Scrap, restart, and fixed overhead per hour: Combine restart loss, purge scrap, utilities, and overhead that continue while output is stopped.

How to use the result

Use it on a one-hour basis to get a clean hourly loss figure for reliability decisions, or scale the basis to cost a known outage length.
It assumes lost revenue is truly forfeited rather than recoverable through buffer stock, overtime, or backlog catch-up later.

Current U.S. benchmarks

As of Jun 2026, average hourly earnings in U.S. manufacturing are $30.27 (BLS), up 4.4% from a year earlier. Burdened shop rates typically run 1.3 to 1.8 times earnings once benefits and overhead are loaded.
U.S. manufacturing runs at 75.6% of capacity (Federal Reserve, May 2026). New factory orders are up 2.3% year over year (Census).

Common questions

How do you calculate downtime cost per hour? Add lost production revenue per hour, direct labor waste per hour, and scrap, restart, and overhead per hour, scaled by the hours basis. On a one-hour basis with $8,500, $900, and $1,800, the cost is $11,200 per hour.
What should be included in downtime cost? Forfeited revenue or margin on lost output, the wages of idled staff, and the scrap, restart, and fixed overhead absorbed with no production. Here those are $8,500, $900, and $1,800, summing to $11,200.
Why use a one-hour basis? A one-hour basis gives a clean per-hour loss you can drop directly into payback calculations and criticality rankings. Set the basis to the actual outage length when you want the total cost of a specific event instead.
What is a good downtime cost per hour? There is no universal good number - it depends on line value. The point is accuracy: an $11,200/hr figure justifies far more reliability spend than a guessed $2,000/hr, so undervaluing it leads to chronic under-maintenance.
Lost revenue vs total downtime cost - what is the difference? Lost revenue, $8,500 here, is only the forfeited sales or margin. Total cost adds $2,700 of labor, scrap, and overhead to reach $11,200, capturing costs that accrue even when nothing is being produced.

Last reviewed 2026-05-12.