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Paul Tracy

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Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 2 million monthly readers. While there, Paul authored and edited thousands of financial research briefs, was published on Nasdaq. com, Yahoo Finance, and dozens of other prominent media outlets, and appeared as a guest expert at prominent radio shows and i...

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Updated August 5, 2020

What is Idle Time?

Also called down time, idle time is when employees or machines are not working but are being paid.

How Does Idle Time Work?

Let's say Company XYZ manufactures autos. The machine that installs windshields breaks, which holds up the whole line. While the company fixes the machine, everybody else is unable to continue working, creating idle time.

Why Does Idle Time Matter?

Idle time is extremely expensive because money is being paid to people who are creating no revenue or profit in return. For this reason, companies work hard to minimize idle time, both by ensuring that key machinery and people are in proper working order and by analyzing production processes to ensure that everyone always has something to do.

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