In This Article
Introduction
The term "Full-Time Equivalent" (FTE) often sparks varied reactions. Some effortlessly calculate FTEs for multiple roles with diverse schedules, while others recognize the term but may need a moment to compute anything beyond a full-time position. At FTE Tree, we aim to demystify FTE calculations for organizations of all sizes. While our software streamlines the process, understanding the underlying math remains invaluable.
To support you, we've created a downloadable FTE Cheat Sheet available in both Excel and PDF formats.
What Are Full-Time Equivalents?
An FTE measures hours worked relative to a full-time schedule, enabling consistent comparisons across different time periods, whether a day, week, month, or year. This metric is crucial for monitoring staffing levels and analyzing workforce data over time. For instance, comparing one employee's 40-hour week to another's is straightforward, but FTEs shine when comparing a single week's hours to an annual average.
FTEs are typically expressed with two decimal places (e.g., 1.00 or 0.75) for precision, which is the standard in our software. If your organization uses more decimal places for aggregated FTEs, we'd love to hear about your approach. Please contact us!
Calculating FTEs Across Time Periods
FTE calculations are flexible and can be applied to any time frame. The formula is:
Divide the hours worked by the full-time hours for the same period. Below are examples for common periods.
Daily (8-Hour Schedule)
For a standard 8-hour workday, an employee working a full 8 hours equals 1.00 FTE, while 6 hours equals 0.75 FTE.
| Daily - 8 Hours per Period | ||
|---|---|---|
| Hours Worked | 8 | |
| Full-Time Hours | ÷ | 8 |
| FTE | = | 1.00 |
| Daily - 8 Hours per Period | ||
|---|---|---|
| Hours Worked | 6 | |
| Full-Time Hours | ÷ | 8 |
| FTE | = | 0.75 |
Weekly (40-Hour Schedule)
In a standard 40-hour workweek, someone working all 40 hours is at 1.00 FTE, while 32 hours equals 0.80 FTE.
| Weekly - 40 Hours per Period | ||
|---|---|---|
| Hours Worked | 40 | |
| Full-Time Hours | ÷ | 40 |
| FTE | = | 1.00 |
| Weekly - 40 Hours per Period | ||
|---|---|---|
| Hours Worked | 32 | |
| Full-Time Hours | ÷ | 40 |
| FTE | = | 0.80 |
Biweekly (80-Hour Schedule)
For a biweekly pay period with 80 full-time hours, an employee working all 80 hours is at 1.00 FTE, while 64 hours gives 0.80 FTE.
| Biweekly - 80 Hours per Period | ||
|---|---|---|
| Hours Worked | 80 | |
| Full-Time Hours | ÷ | 80 |
| FTE | = | 1.00 |
| Biweekly - 80 Hours per Period | ||
|---|---|---|
| Hours Worked | 64 | |
| Full-Time Hours | ÷ | 80 |
| FTE | = | 0.80 |
Overtime
FTEs can exceed 1.00 when hours worked surpass the full-time standard. For example, 90 hours in an 80-hour biweekly period equals 1.13 FTE.
| Biweekly - 80 Hours per Period | ||
|---|---|---|
| Hours Worked | 90 | |
| Full-Time Hours | ÷ | 80 |
| FTE | = | 1.13 |
Annual (2,080-Hour Schedule)
Annually, FTEs are often based on 2,080 hours (8 hours/day, 5 days/week, 52 weeks/year). The table below breaks down how this standard is calculated.
| Annual Hours per FTE | ||
|---|---|---|
| Hours per Day | 8 | |
| Days per Week | × | 5 |
| Hours per Week | = | 40 |
| Weeks per Year | × | 52 |
| Annual Hours per FTE | = | 2,080 |
Exceptions to the 2,080-Hour Standard
While 2,080 hours is the norm, some organizations adjust this figure for factors like leap years or specific accounting practices. However, 2,080 hours is a reliable default for most calculations.
Get Started with FTE Tree
Calculating FTEs is straightforward: divide hours worked by the full-time hours for the period. FTE Tree gives operations, finance, and HR teams precise FTE tracking with support for direct FTE input or schedule-based calculations over various periods (1, 7, 14, or 28 days), plus dynamic annual hour adjustments for accurate cost estimates.
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