How To Calculate Raise Percentage From Old & New Salary
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Want to crunch the numbers yourself? Use these free tools:
- 3% 5% 10% Pay Raise Calculator 2026 — 3% 5% 10% Pay Raise Calculator 2026
- Hourly to Salary Calculator — Hourly to Salary Calculator
- Take Home Pay Estimator — Take Home Pay Estimator
The Core Raise Percentage Formula
Formula: Raise % = (New Salary − Old Salary) ÷ Old Salary × 100
That’s the whole thing. The difference between the two salaries, divided by the old salary, times 100 to turn it into a percent.
One thing to get right: you always divide by the old (starting) salary, never the new one. Dividing by the new number gives you the wrong answer — too small. If you go from $50k to $55k, the raise is 5,000 ÷ 50,000 = 10%, not 5,000 ÷ 55,000 = 9.1%.
Step-by-Step: Calculating Your Raise Percentage
Let’s run it with a real example. Say you were at $58,000 and your new offer is $62,560.
- Subtract old from new. $62,560 − $58,000 = $4,560. That’s the dollar raise.
- Divide by the old salary. $4,560 ÷ $58,000 = 0.0786.
- Multiply by 100. 0.0786 × 100 = 7.86%.
So that’s about a 7.9% raise. Pretty solid for 2026.
Want to check it in reverse? $58,000 × 1.0786 = $62,559. Matches. The pay raise calculator does both directions in one click — plug in either pair of numbers and it’ll spit out the percentage and the dollar change.
Where do people mess this up? Mixing up hourly and annual. If your raise is quoted in hourly rate ($22 → $24), you can either run the percentage on the hourly number directly (same result, since both scale by hours) or convert first using the hourly-salary-calculator. Both roads get to the same percentage.
2026 Real Case: Devin’s Counter-Offer
Devin, a junior dev in Austin, was making $72,000. His current employer counter-offered another job offer with $77,400. He wanted to know if that was actually competitive.
- Dollar raise: $77,400 − $72,000 = $5,400
- Percentage: $5,400 ÷ $72,000 = 0.075 = 7.5%
The competing offer was $80,000, which works out to ($80,000 − $72,000) ÷ $72,000 = 11.1%. So the counter was a 7.5% bump — decent, but clearly short of the 11.1% he’d been offered elsewhere. He took the new job. Here’s the thing: without running the percentage, “77,400” and “80,000” both just looked like “more money,” and the gap felt smaller than the 3.6-point difference actually was.
Quick Reference: Common Raise Percentages
Starting from a $60,000 salary. Use this as a sanity check when you’re doing the math by hand.
| Raise % | Dollar Raise | New Salary |
|---|---|---|
| 2% | $1,200 | $61,200 |
| 3% | $1,800 | $61,800 |
| 4% | $2,400 | $62,400 |
| 5% | $3,000 | $63,000 |
| 7% | $4,200 | $64,200 |
| 10% | $6,000 | $66,000 |
If your “new salary” doesn’t match the table, double-check which direction you divided. Old in the denominator, every time.
What’s a “Good” Raise Percentage in 2026?
Context matters more than the raw number. A 4% raise feels different depending on inflation, your industry, and whether you got promoted.
| Situation | Typical Raise Range | Notes |
|---|---|---|
| Cost-of-living adjustment | 3–4% | Tracks inflation roughly |
| Merit raise, same role | 4–6% | Solid performance, no promo |
| Promotion raise | 7–15% | Bigger jump, new responsibility |
| Counter-offer raise | 8–15% | Often matches competing offer |
| Job-change raise | 10–20% | Biggest mover; switching employers |
A 3% raise when inflation is 3% means you’re treading water in real terms. A 5% raise when inflation is 3% is a real gain. The 3% vs 5% vs 10% net annual impact guide walks through what those percentages actually translate to after taxes — worth reading before you celebrate.
For the underlying formula in more detail, the raise percentage calculation overview covers edge cases like prorated mid-year raises and signing bonuses.
A Couple of Edge Cases
- Mid-year raise. If you get a 6% raise effective October 1, your annualized raise is 6%, but the impact on this year’s pay is only about a quarter of that. Multiply by the fraction of the year remaining.
- One-time bonus vs. base raise. A $4,000 bonus is not the same as a 6% raise on a $66k base. The raise compounds into next year; the bonus doesn’t.
- Shift from hourly to salary. Run the percentage on the annualized numbers, not the hourly rate, or you’ll mislead yourself on overtime loss.
Frequently Asked Questions
What is the formula for raise percentage?
Raise % = (New Salary − Old Salary) ÷ Old Salary × 100. For example, going from $50,000 to $54,000 is a 4,000 ÷ 50,000 = 8% raise.
Do I use gross or net salary to calculate raise percentage?
Use gross salary. Raise percentages are quoted on gross pay. If you want the net impact after taxes, calculate the percentage on gross first, then estimate taxes separately on the raise amount.
Is a 4% raise good in 2026?
A 4% raise is roughly in line with typical US wage growth in 2026. It’s solid if inflation is around 3%, marginal if inflation runs hotter. Context and your industry matter more than the raw number.
How do I calculate raise percentage for an hourly wage?
Same formula with hourly rates: (New Rate − Old Rate) ÷ Old Rate × 100. Going from $20 to $22/hr is a 10% raise. Multiply by 2,080 hours to see the annual impact.
The Bottom Line
The raise percentage formula is just (new minus old) divided by old, times 100 — but the percentage is only useful once you compare it against inflation, your industry’s norm, and what a job change would get you. Run your numbers through the pay raise calculator so you walk into your next review knowing exactly what’s on the table.