Hourly pay vs salary: how to compare them fairly

An hourly offer and a salary offer cannot be compared as written. Convert both to annual gross pay first, using your actual schedule, with the Hourly to Salary Calculator.

Step 1: annualise the hourly offer

Multiply the hourly rate by hours per week and by the weeks you will actually be paid for. $30 an hour at 40 hours a week for 52 weeks is $62,400. If the role has unpaid time off, use fewer weeks; two unpaid weeks brings it to $60,000.

Step 2: check what the salary includes

A salary usually bundles paid holiday, and in many countries employer pension contributions and benefits. An hourly or contract rate usually does not. A common rule of thumb is for freelancers and contractors to add 30 to 50 percent to a salaried equivalent to cover benefits, unpaid time and tax administration; the exact figure depends on your country.

Step 3: compare take-home, not just gross

After annualising, compare expected take-home pay, commute and equipment costs, and how predictable the income is. The higher gross number is not always the better offer once unpaid gaps are counted.

Estimates only. Tax and benefit rules vary by country and contract type.