In business life it is a difficult concept to understand and calculate what one’s worth really is. Even then, what does “My Hourly Worth” mean; it seems to be subjective and vague without fact to base it on. By the end of the article you will be able to calculate your hourly/minute worth and your employee’s hourly/minute worth. What you do with the information is up to you…

I suggest that you use the information at first as an awareness tool for you and your employees. Until you get your head wrapped around the concept, in full or at least to a point where you are confident and clear, do not change processes or procedures. Unless you find a gaping hole in your business infrastructure, “Slow is smooth, smooth is fast” when changing processes or procedures.

The formula can be used in two ways: First is to calculate how much money you need to make per hour to earn X income, yearly. Second is to calculate how much an employee needs to earn the company per hour based on a “base earnings” number.

Below are two illustrations:

Here is the same formula in an equation format with some detail:

1. Base Earnings divided by 1760 = Base Hourly Earnings

a. Base Hourly Earnings times realistic production time = Actual Hourly Earning Needed

b. To calculate your “realistic production time” you would take what you believe to be your “realistic production time” and multiply it by your “un-productive time” like paperwork, government forms, creating quotes, etc.


2. Here the same formula with an example in text form, not handwritten.

a. I want to earn $70,000 this year > divide by 1760 (8 working hours x 220 working days) equals $39.77 which is my base earnings per hour. (I calculate my realistic production time as 1 hour per 3 hours worked)

b. $39.77 times 3 because I am only producing income 1 out of every 3 hours worked to equal $119.31

c. $119.31 divided by 60 (seconds) equals $1.98 per minute of “Actual Hourly Earnings”

The formula/calculation takes a little practice and refinement to come up with your “Hourly Worth”.


What can you determine by this number?

When I am on the phone with a customer, employee or friend during my “production time” and we talk for 30 minutes, I have used approximately $59.65 dollars of my time.

This brings great awareness to me whether it was worth my time or not. It is less a matter of “is this person worth it or not” and more a matter of “let’s table this conversation and let me call you back at 2:00pm when I am not in full production mode”.

Depending on the position that you hold in your company, your numbers will vary drastically. Because it is unrealistic to be productive and billable 8 hours out of an 8 hour day, it is a necessity to block your time to be most productive. For front line employees, your productive time should be a lot higher ergo your hourly number may be lower, because you are able to bill for more time.

I challenge you for the next month or roughly 20 work days to be hyper aware of where and how you spend your time. Before February 1st, 2017, calculate your hourly worth and then track your production for those 20 days. Every Friday, recap your week and see how close you came, either over or under. Recalculate as needed.

Share your progress and with your management team or co-workers and watch your productivity soar! It is amazing what a little awareness does to your “how, where and whom I spend my time with”.


Any questions, advice or comments please email me at:

Inspired by No B.S. Time Management for Entrepreneurs by Dan Kennedy

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