A&E Financial Performance Benchmarks: Utilization Rate

Posted by Jon Bornstein on October 7, 2014

In our next blog post on financial metrics and benchmarks for architecture and engineering firms, let's look at Utilization Rate.

The Utilization Rate (also known as Chargeability) measures the percentage of total staff labor charged to billable projects. Although some A&E firms track utilization on hours or remove vacation, holiday, sick and other paid time off, measuring by dollars and including paid time off shows the clearest picture of labor cost utilization and has become the industry standard.

Utilization recovered in 2011 from its recession lows but since then has been range-bound between 58% and 59%. The 35th Annual Deltek Clarity A&E Industry Study (which examined 2013 financials) did not find dramatic differences by firm size or type, although larger firms were slightly lower. High Performing firms had higher than average Utilization, but not necessarily the highest.

Deltek produces the Deltek Clarity A&E Industry Study as a value to clients and the A&E industry. Read more about Utilization and other key financial metrics in the full, complimentary report.