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Restaurant labor cost calculator
Labor percentage is the number that decides whether this week made money. Enter two figures, get your percentage against the benchmark for your segment.
Every point above benchmark costs that much per period.
WATCH THE LINE · NOT THE PEOPLE
Benchmarks — used as rules of thumb
What operators typically aim for
| Segment | Common labor % range | Why it differs |
|---|---|---|
| Quick service | 25–30% | Counter service, lean staffing, high throughput |
| Fast casual | 25–30% | Limited service, some prep complexity |
| Full service | 30–35% | Servers, bussers, hosts — service is part of the product |
| Fine dining | 35–40% | Service *is* the product; higher skill, higher payroll |
These ranges are widely used industry conventions, not standards — concept, market, and menu pricing move the right target for any one restaurant.
Frequently asked
Labor cost FAQ
What should I include in labor cost?
Everything labor actually costs you: hourly wages and salaries (including managers), payroll taxes, workers’ comp, benefits, and bonuses. Wages alone understate the true number by 15–25%.
What’s a good labor cost percentage?
Common rules of thumb: 25–30% for quick service and fast casual, 30–35% for full service, and up to 35–40% for fine dining, where service is the product. These are industry conventions, not laws — the right number depends on your concept, market, and menu pricing.
Should I calculate it weekly or monthly?
Weekly is the operator’s habit — it catches scheduling problems while you can still fix next week’s schedule. Just make sure revenue and labor cover the same period.
How is this different from prime cost?
Prime cost = labor cost + cost of goods sold (food & beverage). Most operators aim to keep prime cost under roughly 55–60% of sales. Labor percentage is one of its two halves.
My labor percentage is high. What do people actually do about it?
The usual levers, in order of pain: match schedules to sales forecasts (cut dead hours, not people), cross-train so fewer bodies cover the same stations, fix overtime leaks, and reprice menu items that no longer cover today’s wages. A high percentage with strong sales is a scheduling problem; with weak sales it’s a revenue problem.
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Report an issueMethod & notes
Labor % = total labor cost ÷ sales × 100, on matching periods. Include payroll taxes and benefits for a true number. Benchmark ranges reflect common industry guidance for each segment and are labeled as rules of thumb — they are not statistical averages or legal standards. For tipped-staff wage compliance, see our pay checker and state rate lookup.