Job cost variance calculator
Enter one job's estimate and actuals by bucket. See the variance, the margin you quoted, the margin you earned, and which bucket ate the difference.
Prefilled with an example CNC job (JB-10421, quoted at $12,500). Replace the numbers with your own; nothing leaves your browser.
| Cost bucket | Estimated | Actual | Variance |
|---|---|---|---|
| Labor | +$300(+10.7%) | ||
| Setup | +$50(+8.3%) | ||
| Burden / overhead | +$200(+10.5%) | ||
| Material | +$150(+4.7%) | ||
| Outside processing | +$20(+5.0%) | ||
| Total cost | $8,900 | $9,620 | +$720 |
- Quoted margin
- 28.8%
- Actual margin
- 23.0%
- Margin erosion
- −$720(-5.8 pts)
Labor is the largest overrun at $300 — 42% of the total cost variance. Start the review there.
How the math works
- Variance per bucket = actual − estimated. Positive means the job overran.
- Quoted margin = (revenue − total estimated cost) ÷ revenue.
- Actual margin = (revenue − total actual cost) ÷ revenue.
- Margin erosion = total variance in dollars, and actual margin − quoted margin in points.
In the example, total cost ran $720 over an $8,900 estimate. Margin fell from 28.8% to 23.0%. Labor alone accounts for $300 of that, which is where a review should start. For the full method, read the estimated vs actual job costing guide or how to read a variance report.
FAQ
- What is job cost variance?
- Job cost variance is actual cost minus estimated cost for a job. A positive variance means the job cost more than you quoted for. It is usually split by bucket (labor, setup, burden, material, outside processing) so you can see which part of the estimate was wrong.
- How do I calculate margin erosion on a job?
- Quoted margin is (revenue − estimated cost) ÷ revenue. Actual margin is (revenue − actual cost) ÷ revenue. Margin erosion is the difference, in dollars (actual cost − estimated cost) and in margin points (actual margin − quoted margin).
- Should burden be included in job cost variance?
- Yes, if your estimate included it. Compare like with like: if the quote carried a burden rate on labor hours, include estimated and actual burden. If burden is applied only at month-end, leave it out of both columns.
- What is a normal job cost variance for a machine shop?
- There is no universal number. Many shops treat anything beyond 5–10% on a bucket, or any job losing more than 3–5 margin points, as worth a review. The useful signal is the pattern across jobs: the same part, machine, or customer repeatedly overrunning.
- Is my data stored?
- No. The calculator runs entirely in your browser. Nothing you type is sent to MarginGuard.
Run this on every job, not one at a time
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