Man-Year: Meaning, Overview, Calculations


Investopedia / Zoe Hansen

What Is a Man-Year?

A man-year, or person-year, is a unit of measurement for the amount of work done by an individual throughout the entire year, expressed in the number of hours. The man-year takes the number of hours worked by an individual during the week and multiplies it by 52.

Key Takeaways

  • A man-year is a unit of measurement for the amount of work done by an individual throughout the entire year.
  • Man-years are expressed in hours.
  • A simple calculation of the number of man-hours in a year is 2,080 hours, without accounting for holidays.

How Man-Years Work

Calculated, the man-year may be different for various industries or organizations depending on the average number of hours worked each week, the number of weeks worked per year, and deductions, if any, for official holidays. The U.S. Postal Service calculates a man-year on a straightforward basis: 40 hours per week x 52 weeks, or 2,080 hours. The Office of Management and Budget (OMB) of the executive branch sets 1,776 hours as a person-year, allowing for holiday time.

Calculating the man-year will depend on each company and their own uses for the measurement. The pure definition of a man-year typically excludes not only holidays, but also break time during the workday for lunch, 15-minute breaks, and other kinds of time off. As a result, the man-year should only reflect actual hours worked or labored.

Calculating the Man-Year

There are two main reasons why an organization may calculate the man-year applicable to its employees. For one, that organization may use the man-year along with sales or cost figures as a performance metric. For example, a company may calculate a sales per man-year metric and compare it to values from previous years. By knowing the man-year metric up front, companies can then better calculate their return per hour of work done and better calculate productivity or per-person contribution towards sales or the ultimate revenue metric.

The second reason a company would calculate the man-year would be for budgetary reasons. For example, a corporation may calculate the total man-years for various offices that it operates and allocate budgets according to office size. Or, to carry out cost comparisons for a particular job or task, an organization or firm can estimate the number of work hours required and divide this number by a man-year to determine the number of full-time equivalent (FTE) positions needed. Contractors bidding for the job would submit their FTE estimates, and these estimates would be considered for the awarding of the contract. In other cases, managers can use man-hours to calculate the amount of personnel needed to complete a project to create a contract timeline.

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