1. What is Pay Increase Percentage?

The Pay Increase Percentage measures the relative change in salary or wages between an old pay rate and a new pay rate. It helps employees understand the magnitude of their raise in percentage terms rather than just dollar amount.

2. How Does the Calculator Work?

The calculator uses the percentage increase formula:

Where:

• New Pay — The current or proposed pay rate
• Old Pay — The previous pay rate

Explanation: The formula calculates the difference between new and old pay, divides by the old pay to get a decimal ratio, then multiplies by 100 to convert to percentage.

3. Importance of Pay Increase Calculation

Details: Understanding pay increase percentage helps employees evaluate raises in context of their current salary, compare job offers, and negotiate compensation more effectively.

4. Using the Calculator

Tips: Enter both old and new pay amounts in the same currency (dollars in this case). Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What's considered a good pay increase percentage?
A: Typically 3-5% is standard for annual cost-of-living adjustments, while 10%+ may indicate a promotion or significant role change.

Q2: How does this differ from percentage point increase?
A: Percentage increase is relative to the original amount, while percentage points refer to absolute difference between two percentages.

Q3: Should I include bonuses in pay calculations?
A: For base salary comparisons, exclude bonuses. For total compensation comparisons, include all monetary benefits.

Q4: How do I calculate pay decrease percentage?
A: The same formula works - the result will simply be negative if new pay is less than old pay.

Q5: Does this account for inflation?
A: No, this calculates nominal increase. For real increase, you'd need to adjust for inflation separately.