How to Convert Your Salary to an Hourly Rate

Converting a salary to an hourly rate is one of the most useful pay calculations you can do, and it is the foundation for comparing a salaried offer against an hourly one. The math is simple, but the assumptions you plug in change the answer a lot, so it is worth doing it carefully.

The salary-to-hourly formula

Hourly rate = annual salary / (hours worked per week x weeks worked per year). The standard assumption is 40 hours per week and 52 weeks per year, which gives 2,080 paid hours. Divide your annual salary by 2,080 and you have your effective hourly rate.

On a $60,000 salary at 40 hours a week, that is 60,000 / 2,080 = $28.85 per hour. On a $50,000 salary it is 50,000 / 2,080 = $24.04 per hour. The same formula works for any salary; just keep the hours consistent.

What changes the denominator

The 2,080-hour figure assumes you are paid for every week of the year, including paid time off. If you are an hourly employee who does not get paid time off and you take two weeks off, your paid hours drop to 2,000, and your effective rate falls accordingly. Conversely, if you regularly work unpaid overtime, your true hourly rate is lower than the simple division suggests because you are spreading the same salary over more hours.

A few common denominators:

• 40 hours x 52 weeks = 2,080 hours (standard full-time, paid time off included)
• 37.5 hours x 52 weeks = 1,950 hours (common in some office and public-sector roles)
• 40 hours x 50 weeks = 2,000 hours (two weeks of unpaid time off)

Converting monthly and biweekly pay

If you are paid monthly, annualize first by multiplying by 12, then divide by 2,080. A $5,000 monthly salary is $60,000 a year, which is $28.85 an hour. If you are paid biweekly, multiply one paycheck by 26 to get the annual figure, then divide by 2,080. A $2,308 biweekly check times 26 is about $60,000, again $28.85 an hour.

calculate your new salary after a raise

Overtime and the hourly floor

federal overtime rule

Salaried exempt employees generally do not receive overtime no matter how many hours they work, which is why converting a salary to an hourly rate can reveal whether an exempt role actually pays more than an equivalent hourly role once overtime is included.