Free calculator

Effective Hourly Rate Calculator

Calculate what a project actually paid per hour after direct expenses and all working time are included.

Project details

Enter the project income, direct expenses, and time spent.

Result

Review the net income, total time, and effective hourly rate.

Net project income $2,750.00
Total working time 33 hours
Effective hourly rate $83.33/hour

This estimate excludes taxes, general business overhead, and unpaid time outside the hours entered.

Your values are calculated directly in this browser. This tool does not upload them to Mycelgrid for calculation. Review the estimate before using it for pricing, tax, accounting, or contract decisions.
How to Use Examples FAQ Method

How to use the calculator

  1. Enter the total amount the client or customer paid for the project.
  2. Enter direct project expenses such as travel, hired help, stock assets, or equipment rental.
  3. Enter all hours spent planning, producing, editing, revising, and communicating.
  4. Review the effective hourly rate and compare it with your own target or pricing floor.

Worked example

A project pays $3,000, includes $250 in direct expenses, and requires 33 total hours. Net project income is $2,750. Dividing $2,750 by 33 hours produces an effective hourly rate of about $83.33 per hour.

Frequently asked questions

Why is my effective hourly rate lower than expected?

Flat project fees can look strong until preparation, revisions, communication, and direct expenses are included. The calculator makes those hidden costs visible.

Should I charge hourly or use a project fee?

A project fee can work well when the scope and deliverables are clear. Hourly pricing may be more appropriate when the scope is uncertain. In either case, an internal hourly target can help you evaluate whether the work is sustainable.

Should taxes and software subscriptions be included?

This calculator focuses on project revenue, direct project expenses, and working time. Taxes and recurring overhead can be added to expenses when you want a broader estimate, but the result should still be treated as an estimate rather than accounting advice.

What happens if expenses exceed revenue?

The calculator will show negative net project income and a negative effective hourly rate. That indicates the project cost more than it earned before taxes and broader overhead.

Calculation method

Net project income = Project revenue − Direct expenses Total working time = Preparation hours + Production hours + Post-production hours + Revision and communication hours Effective hourly rate = Net project income ÷ Total working time

If total working time is zero, the calculator does not produce an hourly rate. Negative values are rejected. Decimal hours are supported.

Need a fuller explanation of the formula and its limits? Read what effective hourly rate means and how it is calculated.