# Overtime vs Added Shift Cost Calculator

> Source: https://netray.co/tools/overtime-vs-added-shift-cost-calculator
> Publisher: Netray (netray.co), AI and integration engineering for ERP and manufacturing systems.
> Section: Free Tools

## Short answer

Compare the weekly cost of covering a machine-hour shortfall with overtime against running an extra shift.

## Category

mes-shop-floor

## Industry

Discrete Manufacturing

## Audience

- Production manager
- Production scheduler
- Plant controller

## Tool

**Kind:** calculator

**Currency:** $

**Inputs:**

#### Weekly machine-hour shortfall

**Key:** short_hrs

**Type:** slider

**Default:** 40

**Min:** 4

**Max:** 200

**Step:** 2

**Unit:** hours

**Help:** Required machine hours minus available hours at the bottleneck.

#### Crew per machine

**Key:** crew

**Type:** number

**Default:** 2

**Min:** 1

**Step:** 1

**Unit:** people

#### Base hourly wage

**Key:** wage

**Type:** number

**Default:** 24

**Min:** 0

**Step:** 0.5

**Unit:** per hour

#### Overtime multiplier

**Key:** ot_mult

**Type:** select

**Default:** 1.5

**Options:**

##### 1.25x

**Value:** 1.25

##### 1.5x

**Value:** 1.5

##### 2.0x

**Value:** 2

#### Overtime productivity

**Key:** ot_eff

**Type:** number

**Default:** 90

**Min:** 50

**Max:** 100

**Step:** 1

**Unit:** %

**Help:** Fatigue and short notice often cut output in overtime.

#### Shift differential

**Key:** diff

**Type:** number

**Default:** 10

**Min:** 0

**Step:** 1

**Unit:** %

#### Shift length

**Key:** shift_len

**Type:** number

**Default:** 8

**Min:** 4

**Max:** 12

**Step:** 1

**Unit:** hours

#### New shift productivity

**Key:** shift_util

**Type:** number

**Default:** 85

**Min:** 40

**Max:** 100

**Step:** 1

**Unit:** %

#### Fixed cost per added shift (supervision, utilities)

**Key:** fixed

**Type:** number

**Default:** 250

**Min:** 0

**Step:** 10

**Unit:** per shift

**Outputs:**

#### Overtime paid labor hours

**Key:** ot_paid

**Expr:** short_hrs / (ot_eff / 100) * crew

**Format:** number

#### Overtime cost per week

**Key:** ot_cost

**Expr:** ot_paid * wage * ot_mult

**Format:** currency

**Primary:** true

#### Added shifts needed per week

**Key:** shifts

**Expr:** ceil(short_hrs / (shift_len * shift_util / 100))

**Format:** integer

#### Added shift cost per week

**Key:** shift_cost

**Expr:** shifts * (shift_len * crew * wage * (1 + diff / 100) + fixed)

**Format:** currency

**Primary:** true

#### Overtime minus added shift

**Key:** diff_cost

**Expr:** ot_cost - shift_cost

**Format:** currency

**Description:** Positive means the added shift is cheaper on these inputs.

**Chart:**

#### Weekly cost versus shortfall hours

**Type:** line

**X:** short_hrs

**From:** 4

**To:** 200

**Steps:** 40

**Series:**

- ot_cost
- shift_cost

**Disclaimer:** A cost comparison only. Ignores hiring time, training, quality effects, labor-law limits and union rules. Verify with HR and finance.

## Content

**Intro:** When a bottleneck is short of hours, overtime is quick but expensive and a new shift is slower to arrange. This calculator compares the weekly cost of each and shows where the lines cross.

**Sections:**

#### How to use it

**Body:** Enter the weekly machine-hour shortfall at the bottleneck, crew size, base wage and the overtime multiplier. Add the productivity you expect from overtime and from a new shift, plus the shift differential and fixed cost per added shift. The results show the weekly cost of both options, and the chart sweeps the shortfall so you can see the break-even point.

#### The method

**Body:** Overtime cost equals the shortfall divided by overtime productivity, times crew, times wage, times the multiplier. Added shift cost equals the number of shifts needed times the labor for one shift with differential, plus fixed cost. Shifts needed is the shortfall divided by productive hours per shift, rounded up. Small shortfalls favor overtime because a shift has a fixed cost. Large, recurring shortfalls favor the shift.

**Bullets:**

- Overtime has a lower fixed cost but a higher hourly rate.
- An added shift has fixed overhead and a ramp-up period.
- Both fall in value if the machine is not the real bottleneck.

#### Reading the result

**Body:** If the difference is positive, the added shift is cheaper at that shortfall. Check how long the shortfall will last. For two or three weeks, overtime is typically the practical choice even if it costs more. For a quarter or more, recruiting and training for a shift often pays. Run the numbers at the low and high end of your expected demand.

#### Common mistakes

**Body:** Do not apply overtime to non-bottleneck work. Do not forget that overtime productivity drops across consecutive weeks. And do not assume a second shift reaches full productivity in week one; new crews need ramp-up time and supervision.

**Cta:** If you want this comparison driven by your actual ERP load and labor rates, we can connect the model to your data.

**Faq:**

#### Does this include payroll taxes and benefits?

**Answer:** Not directly. Increase the base wage to a loaded rate if you want employer costs included, though some benefits do not scale with overtime hours.

#### Why does the added shift cost jump in steps?

**Answer:** Shifts are whole units. Even a small extra shortfall that exceeds one shift's productive hours requires a second shift, so cost steps up.

#### What if overtime is limited by law?

**Answer:** Then the model overstates overtime's availability. Check local limits on weekly hours and rest periods and use the added shift option when limits bind.

#### Should I consider outsourcing?

**Answer:** Yes, as a third option for short peaks. Compare the outsourced unit price plus freight against the cost per unit here.

## Search terms

overtime vs second shift calculator, overtime cost calculator manufacturing, add a shift cost analysis, shift differential calculator, capacity shortfall overtime cost, extra shift vs overtime, overtime premium cost calculator, second shift cost calculator

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