Workforce, Labor Standards & Skills Planning worked example

Direct Labor Cost at 99% productive time share: a worked example

What does the result look like when productive time share reaches 99%? The full calculation is worked below with real intermediate numbers. A cost estimator uses it to price the hands-on labor content of a job before adding overhead and material.

The inputs for this scenario

  • Direct labor hours worked: 320 hrs (unchanged)
  • Loaded hourly wage (wage + burden): 34 $/hr (unchanged)
  • Productive time share (value-add %): 99 % (raised for this scenario; the documented default is 88)
  • Shift premium / off-shift adder: 800 $ (unchanged)

Working through the calculation

  • Applying the documented formula (Direct labor cost = labor hours x loaded wage x productive time share + shift premium) to the inputs above produces each figure below.
  • At this operating point the engine returns 11,571 $ for total direct labor cost, the number this scenario is built around.
  • At this operating point the engine returns 36.16 $ / piece for direct labor cost per unit.
  • At this operating point the engine returns 10,771 $ for variable direct labor cost.
  • At this operating point the engine returns 800 $ for fixed direct labor cost adder.

How this compares with the baseline

  • Against the tool's baseline example, where productive time share sits at 88% and the headline result is 10,374 $, this scenario comes in 11.54% above the baseline at 11,571 $.
  • A figure at this level is achievable when productive time share is genuinely sustained, not just peaked for a shift. It treats the productive time share as a flat percentage; real shrink from breaks, changeovers and rework varies by shift and station, so validate the assumption against timekeeping data before trusting the per-unit figure.

Results at a glance

  • Total direct labor cost: 11,571 $ (headline result)
  • Direct labor cost per unit: 36.16 $ / piece
  • Variable direct labor cost: 10,771 $
  • Fixed direct labor cost adder: 800 $

Run it with your numbers

  • Every input above is editable in the live Direct Labor Cost calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.