1. What is Pay Increase Percentage?

The Pay Increase Percentage measures how much a salary or wage has increased compared to the previous amount. It's expressed as a percentage of the original pay and helps employees understand the relative value of their raise.

2. How Does the Calculator Work?

The calculator uses the pay increase percentage formula:

Where:

• \( \text{New Pay} \) — The current or proposed pay amount
• \( \text{Old Pay} \) — The previous pay amount

Explanation: The formula calculates the difference between new and old pay, divides by the old pay to get the relative increase, then multiplies by 100 to convert to a 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. For employers, it helps maintain fair and competitive compensation structures.

4. Using the Calculator

Tips: Enter both old and new pay amounts in the same currency. The calculator works with any currency - just ignore the dollar sign if using a different currency.

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 increases, while 10%+ may indicate a promotion or significant role change.

Q2: How does this differ from percentage points?
A: Percentage points measure absolute difference between percentages, while this calculates relative change from original amount.

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

Q4: What if my pay decreased?
A: The calculator will show a negative percentage, indicating a pay reduction rather than increase.

Q5: How often should I calculate my pay increase?
A: Calculate whenever you receive a raise, change jobs, or annually to track compensation growth.