What your utilisation rate means (and the numbers good agencies hit)

Most agencies sit between 60 and 72 percent.

If the calculator above just showed your team weighted utilisation, it is very likely between 60 and 72 percent. That is where the bulk of small agencies cluster. The 2024 Sortlist Agency Operations Survey puts median small-agency utilisation at 68 percent. The HubSpot State of Marketing Agencies 2024 found the top quartile at 75 to 80 percent sustainably. Six points of utilisation separates a healthy agency from a struggling one. That is the entire gap.

The gap is not about effort. Every agency owner I have spoken to says their team is busy. The team feels busy. The owner feels busy. The calendar is full. But "busy" and "billable-busy" are different things, and the slip between them is where utilisation leaks.

"The hardest conversation we ever had was telling a senior person their utilisation was 45 percent and we needed it at 65 percent. They were busy. They just weren't billable-busy." — r/agency, 2024.

The four patterns that drive low utilisation.

When utilisation is below target, it is almost never a single big problem. It is four smaller ones compounding. Address any one and you typically pick up two to four points. Address all four and you move into the target band.

Pattern 1: Untracked time.

The most common single cause. Team members log billable time when it is convenient, and the rest of the week disappears into a fog. When unlogged time is reconstructed later, it is almost always classified as non-billable because nobody can defend the missing minutes to a client. Honest, real-time time tracking adds 4 to 8 percent utilisation by itself.

Pattern 2: Meetings inflated into work.

Internal status meetings, all-hands, project check-ins, retros, sales calls, training sessions, recruitment interviews. Each one displaces billable work. The Sortlist 2024 survey found small agencies average 11 internal-meeting hours per person per week. That is nearly 30 percent of a 40-hour week with no client billing attached. Trim by half and utilisation moves materially.

Pattern 3: Senior people doing junior work.

A senior strategist at $200 per hour doing administrative work that could be done by a coordinator at $40 per hour is a utilisation problem hiding inside a delegation problem. The senior time is being consumed by non-billable or low-billable activity. The fix is not "more hours" — it is re-scoping who does what.

Pattern 4: Under-quoted scope absorbing free hours.

A client was quoted at 40 hours of work. The actual delivery took 60. The extra 20 hours did not become an invoice. They became non-billable absorption. Multiply by every project where scope ran over and was not re-quoted, and the cumulative effect is significant. The fix is annual scope-and-rate reviews with re-quoting clauses built into every new SOW.

"We hired three more people thinking we were maxed out. Turned out we were running 55 percent utilisation. We didn't need more headcount, we needed to ship time-tracking." — Indie Hackers, 2024.

The over-85 percent trap.

The reverse problem is rarer but expensive. Sustained utilisation above 85 percent looks great on a monthly P&L. It costs you in the year that follows. The AgencyAnalytics 2025 Pricing Benchmark Report found over-85-percent sustained utilisation correlates with 35 percent higher staff turnover in the following 12 months. The economics of replacing a senior team member sit at six to twelve months of their fully-loaded salary. One additional departure pays back any over-utilisation revenue gain several times over.

If the calculator above shows individuals in the at-risk or burnout-risk bands consistently, the right move is to re-price client work to slow demand, hire to spread the load, or both. The sustainable target is the 70-80 percent band, not the maximum.

What to do this week.

1. Run the calculator with honest numbers per person. Especially if your team has not logged time consistently. Use rough estimates rather than refusing to engage.
2. Identify the bottom one or two. If anyone is below 50 percent, the conversation is structural, not motivational. Re-scope what they work on.
3. Audit internal meetings. If your team averages over 8 hours of internal meetings per week per person, you have a tractable problem worth 3 to 5 points of team utilisation.
4. Make utilisation visible weekly. A single shared chart of utilisation per person each Monday changes behaviour without anybody being told to do anything differently.

Related resources

• Standalone Utilisation Rate Calculator
• Agency Hourly Rate Calculator — sets the rate that utilisation multiplies into revenue.
• How to find out which of your clients are losing you money — low utilisation often hides inside specific clients.
• The project billing workflow — how time becomes invoices without manual reconciliation.

Sources cited in this guide

• Sortlist Agency Operations Survey 2024
• Productive.io 2024 Agency Benchmarks
• HubSpot State of Marketing Agencies 2024
• AgencyAnalytics 2025 Pricing Benchmark Report