The cost of manual work: a simple model you can reuse
A transparent formula for estimating what a repetitive task really costs a team per year and how quickly an automation pays for itself.
Estimate a task’s annual cost as people × weekly hours × 46 weeks × loaded hourly cost, multiply by the share you can realistically automate, then divide the build cost by monthly savings to get payback. For example, four people spending five hours a week at $30 an hour cost about $27,600 a year.
Ask a team how much time a repetitive task takes and you will hear “not that much”. Ask them to count it and the number is usually larger. This note gives you a simple, transparent model to put a figure on it, so a decision to automate rests on arithmetic rather than instinct.
How do you calculate the cost of manual work?
- 01Hours per year = people doing the task × hours per person per week × working weeks (use 46).
- 02Annual cost = hours per year × fully loaded hourly cost (salary plus overhead, not just wage).
- 03Recoverable cost = annual cost × share of the task that can realistically be automated.
- 04Payback (months) = build cost ÷ (recoverable cost ÷ 12).
What does a worked example look like?
Four people each spend five hours a week copying enquiry details between a form, a spreadsheet and a CRM. At 46 weeks that is 920 hours a year. At a loaded cost of $30 an hour, that is $27,600. If 70 percent can be automated, the recoverable amount is $19,320 a year, about $1,610 a month. A $12,000 build pays back in roughly 7.5 months.
What the model leaves out
- Error cost: rework, missed follow-ups and wrong data have a price the model ignores.
- Speed: a faster response to a lead or customer can be worth more than the hours saved.
- Morale and focus: people do better work when the dull part is gone.
- Maintenance: a build has running costs, usually small relative to the savings.
Use the model as a floor, not a ceiling. Try it with your own figures in our automation ROI calculator.