Restaurant labor cost calculator
See exactly where your labor stands. Enter your total labor cost and sales for a period, set a target, and we'll show your labor cost percentage, whether you're over or under, and the revenue you'd need to land on target.
Wages + payroll taxes + benefits for the period.
Sales for the same period.
Most restaurants aim for 25–35%.
Results
Labor cost %
30.0%
Labor as a share of sales.
Labor cost
$4,500.00
Sales needed to hit target
$15,000.00
Revenue that lands this labor on target.
How to calculate restaurant labor cost percentage
Labor cost percentage is the share of your sales spent on labor — wages, payroll taxes, and benefits combined. Add up everything you pay your team for a period, divide it by your sales for that same period, and multiply by 100. If you spent $4,500 on labor against $15,000 in sales, your labor cost is 30%. Most full-service restaurants run between 25% and 35% of sales; quick-service tends to sit lower. Watch your prime cost too — labor plus cost of goods sold (COGS) — which profitable operators usually keep under about 60–65% of sales.
The formula
Labor cost % = Total labor cost ÷ Total sales × 100 · Sales needed to hit target = Total labor cost ÷ (Target % ÷ 100)
Tightening your labor? Turn tables faster with a QR menu.
Scanmie puts your menu on a QR code so guests order without waiting on a server — faster turns and tighter labor, with prices you can change anytime on the same printed code.
Labor cost FAQ
- What is a good labor cost percentage for a restaurant?
- Most full-service restaurants target 25–35% of sales, while quick-service and counter concepts often run lower because they need fewer staff hours per cover. The right number depends on your service style, menu complexity, and local wages — use it as a benchmark, not a hard ceiling.
- What should I include in total labor cost?
- Include everything it costs to staff the shift: hourly wages and salaries, overtime, payroll taxes, and the cost of benefits like health insurance and paid time off. Leaving out taxes and benefits understates your real labor cost and makes the percentage look better than it is.
- What is prime cost and how does labor fit in?
- Prime cost is labor cost plus cost of goods sold (the food and beverage you sell). It's the metric most operators manage to because together those two lines drive profitability. Many profitable restaurants keep prime cost under about 60–65% of sales — if labor and COGS each creep up, prime cost is where it shows.
- How can I lower my labor cost percentage?
- You can raise the denominator or lower the numerator: grow sales per labor hour, or trim hours that aren't pulling their weight. Tighter scheduling against forecasted covers, cross-training, and tools that speed up service — like QR ordering that reduces server steps — all help move the percentage without cutting service quality.