How this number is made
Revenue per employee is a blunt productivity figure. Contractors you left out of the headcount will make it look better. A business with high materials cost can have high revenue per person and thin profit. Use it to compare periods of the same firm, not to declare a winner across industries.
- Pick full-time equivalents if part-timers would distort the count.
- Revenue and the headcount should be the same period.
Formula
Revenue per employee = revenue ÷ employees.
Worked example
With the figures already in the form, revenue per employee is $200,000.
Questions
Do founders count?
If they work in the business, yes. The page uses the count you type.
Is higher always better?
Not if it came from cutting people who were keeping customers. It is a ratio, not a goal by itself.