A 5% raise on $25 an hour adds $1.25 an hour, taking the rate to $26.25 and adding $2,600 a year in gross pay at 40 hours a week.
Gross figures before taxes. Annual amounts assume your hours x 52 weeks.
Before a raise shows up anywhere real, it's a single number: the new hourly rate or salary that will replace the old one on your timesheet or in payroll. This tool exists to answer one question before you update anything, what is that new number actually worth, in dollars and in percent.
Enter a percent and the tool solves for the new dollar figure; enter the new dollar figure and it solves for the percent. Both describe the same raise from two different directions.
Start at $25 an hour with a 5 percent raise. New pay is 25 times 1.05, or $26.25, a $1.25 hourly increase. Going the other way, if you were offered $27 an hour instead, the percent increase is (27 minus 25) divided by 25, times 100, which is 8 percent. The same logic works on a salary: a jump from $50,000 to $52,000 is $2,000, or 4 percent.
| Current hourly | Raise | New hourly | Annual increase (40 h) |
|---|---|---|---|
| $18.00 | 3% | $18.54 | $1,123 |
| $20.00 | 5% | $21.00 | $2,080 |
| $25.00 | 5% | $26.25 | $2,600 |
| $30.00 | 10% | $33.00 | $6,240 |
The 2,080-hour year, 40 hours a week across 52 weeks, is what turns a small hourly increase into a number worth negotiating over. A $1.25 raise looks small on a single check; multiplied by 2,080 it's $2,600 a year. That figure assumes no unpaid time off; take two unpaid weeks and real worked hours drop closer to 2,000, which nudges the annual number down slightly. Part-time schedules scale the same way, at 30 hours a week the multiplier is 1,560, not 2,080.
A cost-of-living adjustment is meant to keep pace with inflation. A merit raise is meant to reward performance. They answer different questions, and a year where prices rose faster than your raise is a real-terms pay cut even though the number on your check went up. The Bureau of Labor Statistics tracks wage growth through its Employment Cost Index and inflation through the Consumer Price Index, useful context if you're weighing whether a raise actually kept up.
If the new rate starts partway through a pay period, this tool assumes one rate for the whole period you're testing. For the actual check spanning the change, calculate the hours before the effective date at the old rate and the hours after at the new rate, then add the two together rather than applying the new rate to the whole period.
Sources: BLS Employment Cost Index, BLS Consumer Price Index.
If your timesheet or time card tool takes an hourly rate field, update it to the new number and any pay calculation downstream will use it automatically. This tool exists to show you what that change is worth before you update it elsewhere.
Split the period: calculate hours at the old rate up to the effective date, and hours at the new rate from that date forward, then add the two figures. This tool assumes one rate applies to the whole period you're checking.
The annualized figure uses the hours-per-week value you enter, so update that field too if your schedule is changing, not just the pay rate. Otherwise the annual estimate will reflect your old hours.
Because an annual salary is already a yearly figure and doesn't need an hours multiplier. Hourly pay needs hours per week and 52 weeks to convert into an annual comparison.
It's the standard full-time convention, 40 hours times 52 weeks, but it doesn't subtract unpaid time off. Two unpaid weeks a year brings actual worked hours closer to 2,000.