The Utilization Rate is a measure used to assess how effectively a resource, such as an employee or equipment, is being used. It is calculated by dividing the actual hours worked or used by the total available hours. This percentage helps organizations understand productivity levels and identify areas for improvement. For example, if a worker is available for 40 hours a week but only works 30 hours, the utilization rate would be 75%. A higher utilization rate indicates better use of resources, while a lower rate may suggest inefficiencies or underutilization of employees or equipment.