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A 1.2 million shop with eight people
The year brought in 1,200,000 of revenue. Eight people are on the books. Annual payroll is 480,000. Revenue per person is 150,000. Payroll per person is 60,000.
Annual revenue: 25% lower
Change annual revenue to 900,000 while keeping the other example values the same.
Annual revenue: 25% higher
Change annual revenue to 1,500,000 while keeping the other example values the same.
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Quick answer
What does the Revenue per employee calculate?
How much annual revenue does each employee generate? This calculator uses annual revenue, employees, and annual payroll to estimate sales on each person on the books immediately in your browser.
With the values currently entered, the result is $150,000.00 — revenue per employee. It also shows payroll per employee, payroll share of revenue, and employees.
How to use the Revenue per employee
- Replace the example values with your own numbers.
- Review the result and supporting figures as they update automatically.
- Check the formula and assumptions before using the estimate for a decision.
Inputs used
- Annual revenue
- Employees — entered in people
- Annual payroll
Revenue per employee formula
Revenue per employee = annual revenue ÷ employees. Payroll per employee = annual payroll ÷ employees. Payroll share = payroll ÷ revenue.
Assumptions
- Census SUSB annual tables publish receipts and employment for employer firms. This page uses the same quotient on the revenue and headcount you type.
- Use one period, usually a year. A part-time person can be a fraction if that is how you count the team.
Verify the inputs
Authoritative sources
These sources explain the definitions, factors, or rules behind this tool. Their geographic scope is shown because an official source for one country is not automatically valid somewhere else.
SUSB annual tables publish receipts and employment by firm size. Receipts per employee is annual receipts divided by that employment count.
Beginners’ guide to financial statementsUS Securities and Exchange CommissionScope: General investor education; US sourceWalks an income statement from sales to cost of sales, then to gross profit, operating expenses, and the bottom-line net earnings.
Sources do not endorse Calculum. Check the source date, scope, and your own documents before making a financial, tax, insurance, or reporting decision.
Practical guide
Revenue per employee example and edge cases
Revenue per employee is annual sales divided by headcount. Census SUSB tables publish receipts and employment for employer firms, so the same quotient is receipts divided by employment.
Example: A 1.2 million shop with eight people
The year brought in 1,200,000 of revenue. Eight people are on the books. Annual payroll is 480,000. Revenue per person is 150,000. Payroll per person is 60,000.
- Annual revenue
- 1,200,000
- Employees
- 8 people
- Annual payroll
- 480,000
Calculated result$150,000.00revenue per employee
Payroll takes 40 percent of revenue. The leftover 720,000 still has to cover everything that is not wages. If you want the loaded cost of one hire, open the employee true cost calculator.
Example results use the default display profile. The calculator above follows your selected country and units.
How to read the result
- Read the sales-per-person figure first. Then check payroll share. A high sales line with a high payroll share can still leave little cash.
- This is an average. One rainmaker and seven support people will not each produce 150,000.
Edge cases worth checking
Contractors do most of the work
They are not in the employment count Census uses for employer firms. If you want output per person who ships work, add those contractors to the headcount or the ratio looks too good.
The owner takes a draw, not a wage
The draw is not in payroll unless you put it there. Add the draw if you want payroll share to include the person who runs the shop.
What changes the result most
Annual revenue
Use a current amount for annual revenue. Include fees or recurring costs that belong in the same figure.
Employees
Use the count you expect in real life. Round up when a partial people cannot be purchased or used.
Annual payroll
Use a current amount for annual payroll. Include fees or recurring costs that belong in the same figure.
Try a different scenario
Small changes show whether the answer is stable or sensitive.
Annual revenue: 25% lower
900,000$112,500.00revenue per employee
Annual revenue: 25% higher
1,500,000$187,500.00revenue per employee
Employees: 25% higher
10 people$120,000.00revenue per employee
Common mistakes
Check annual revenue
Census SUSB annual tables publish receipts and employment for employer firms. This page uses the same quotient on the revenue and headcount you type. Make sure this matches the number you enter.
Keep annual payroll consistent
Use one period, usually a year. A part-time person can be a fraction if that is how you count the team. Use the same units and time period throughout the calculation.
Do not rely on one revenue per employee scenario
Run a cautious case and an optimistic case. The range is often more useful than one exact-looking number.
Use this result well
How much annual revenue does each employee generate?
It does not replace a quote, contract, accountant, or local employment guidance.