Every Australian engineering workshop owner knows labour is their biggest cost. Most of them also quietly know their labour tracking is loose — paper timesheets, Friday afternoon reconstruction, hours booked against "whatever job the guys say they were on."
What they don't know is what that loose tracking actually costs them. This post breaks down the real cost of untracked time in an Australian engineering workshop, line item by line item, so you can make a clean-headed decision about whether fixing it pays off.
The setup: a typical 10-person, $2M-revenue AU engineering shop
To ground the numbers, let's use a standard profile: 10 production staff, A$2M annual revenue, paper or spreadsheet timesheets, MYOB AccountRight for accounting, no production scheduling tool, no biometric clock-in.
Standard profile. Nothing extreme. Representative of a chunk of Australian engineering, machining, and fabrication shops.
Leak 1: Reconstruction and mis-attribution
When timesheets are filled in at the end of the day or end of the week, 15-25% of the labour hours end up attributed to the wrong job. Not lost — misattributed. Hours spent on Job A get booked against Job B because that's the one the staff member remembered.
The cost: You can't fix a margin problem you can't see. Your P&L says Jobs A and B are both profitable; in reality one is losing money and one is making a lot. You quote the next similar job based on bad data.
A$300,000–500,000
Labour cost moving between jobs invisibly
Leak 2: Rework hidden inside normal hours
Rework — fixing a bad cut, re-making a part that failed QA, re-doing a weld — is a fact of engineering life. In most shops, rework hours get booked against the original job's normal budget, so the shop never learns it has a rework problem. The job just "ran over."
The cost: For a typical engineering shop, 5-12% of labour hours are rework. Hidden inside normal time, invisible to management. If you don't know you have it, you can't train it out or redesign around it.
A$100,000–240,000
Rework cost absorbed into "normal" job time
Leak 3: Underquoting from bad historical data
When the hours on past jobs are wrong, your quote on the next similar job is wrong. For an engineering shop, this usually biases toward UNDER-quoting — because the "hours we charged last time" was estimated by the staff member who did the job, who estimated low.
The cost: You win jobs on sharp pricing, you deliver them, you look at the margin afterwards and wonder what happened. It happened in the quote, three months earlier, because the historical data was wrong.
5–12%
Margin lost on jobs underquoted from bad historical data
Leak 4: Non-productive time invisible
Setup time, tool changes, cleanup, waiting on materials, waiting on a QA sign-off, waiting on the next job to be released. In a workshop without floor-level time capture, all of this gets buried in "general" or booked against whatever job is nearest.
The cost: Non-productive time is 10-25% of total floor hours in a typical engineering workshop. If you don't measure it, you can't tackle it. You pay full wage rate for it either way.
A$150,000–400,000
Non-productive time paid at full labour rate
Leak 5: Capacity planning done on vibes
Without accurate historical data on how long jobs really take and who is actually available when, capacity planning becomes a gut-feel exercise. You either take on too much and run into overtime, or you leave capacity on the table.
The cost: For a 10-person shop, every week of mis-planned capacity is roughly A$8,000 in either overtime cost or lost revenue. Over a year, four to eight weeks of this kind of drift adds up.
A$32,000–64,000
Overtime + lost revenue from capacity planning on guesses
What "fixing it" actually costs vs. recovers
Proper floor-level time tracking — touchscreens, biometric clock-in if you want it, direct integration with MYOB — costs an AU engineering shop somewhere between A$500 and A$2,000 a month depending on team size. Rollout is typically a week on-site.
Against the leaks above, that's a payback period measured in weeks, not years.
Why most owners still don't do it
- It feels invasive. Staff resist being tracked, so the owner avoids the conversation.
- The leak is invisible on the P&L. You can't see what isn't measured, so it feels theoretical.
- The last tool they tried didn't stick. Clunky software, no floor training, staff worked around it.
- They're busy. Running the shop is a full-time job, and "fix time tracking" sits on the list below "ship this week's jobs."
All of those are real. None of them are reasons not to fix it. The leak compounds every year.
The bottom line
An Australian engineering workshop that doesn't track time properly isn't just leaving money on the table — it's leaving six figures a year on the table, in ways that never show up as a line item on the P&L. Fixing it is the single highest-return project most engineering shops have available.
Empower runs this layer for 250+ workshops across NZ and Australia, including engineering shops like Global Pumps (NSW + WA) and BPF Equipment (SA). Read more about how Empower fits Australian workshops, or see the time tracking module in detail.
