Home
Back
Pay Increase Formula:
| From: | To: |
The pay increase percentage measures how much a salary or wage has increased compared to the previous amount. It's a key metric for understanding salary growth, negotiating compensation, and financial planning.
The calculator uses the percentage increase formula:
Where:
Explanation: The formula calculates the relative change between the new and old pay amounts, expressed as a percentage of the original amount.
Details: Understanding pay increase percentages helps employees evaluate job offers, track career progression, and negotiate salaries. For employers, it assists in budgeting and compensation planning.
Tips: Enter both pay amounts in the same currency (before taxes). The old pay should be your previous salary, and new pay your current or proposed salary.
Q1: What's considered a good pay increase percentage?
A: Typically 3-5% is standard for annual raises, while 10%+ may indicate a promotion or significant role change.
Q2: Should I include bonuses in the calculation?
A: For base salary comparisons, exclude bonuses. For total compensation comparisons, include all earnings.
Q3: How does this differ from cost-of-living adjustments?
A: COLA matches inflation, while pay increases may exceed inflation to reflect performance or market changes.
Q4: Can the percentage be negative?
A: Yes, if new pay is lower than old pay, it indicates a pay decrease.
Q5: How often should I calculate my pay increase?
A: Annually for routine tracking, or whenever considering a job change or promotion.