Salary ↔ Hourly Converter

Converting between annual salary and hourly rate sounds simple but trips people up because of vacation, holidays, and the difference between worked and paid hours. The conversion you want depends on whether you're comparing job offers or calculating freelance rates.

The conversion formulas

Salary to hourly: divide annual salary by 2,080 (40 hours × 52 weeks). Hourly to salary: multiply hourly rate by 2,080. To compare a salaried job (typically with paid time off) to an hourly job (often without), subtract unpaid vacation hours from 2,080 in the hourly direction. To compare full-time employment to freelancing, divide by 1,000-1,500 actual billable hours instead.

When to use this calculator

Use it when evaluating job offers in different formats (one offer in salary, another in hourly). Use it when negotiating raises — knowing your hourly equivalent makes overtime conversations more concrete. Use it when considering a switch to freelancing: the equivalent hourly rate is typically 1.5-2× the W-2 hourly because freelancers pay self-employment tax, healthcare, and unbillable time.

Worked example

$75,000/year ÷ 2,080 = $36.06/hour for a full-time W-2 role. As a freelancer, the equivalent rate is roughly $54-72/hour to net the same after self-employment tax (15.3% extra), healthcare (~$8K/year out of pocket), unpaid time off (~3 weeks), and downtime between clients.

Limits and assumptions

The conversion is linear: hourly rate = annual salary ÷ (hours per week × weeks per year), and the reverse for hourly to salary. The defaults of 40 hours and 52 weeks give the 2,080-hour year most payroll departments use; change the weeks figure to account for unpaid leave.

The result is gross pay. Tax, pension contributions, health insurance and other benefits are not included, and overtime, bonuses and commissions are not modelled. For freelance pricing, which also has to cover non-billable time and business costs, use the freelance rate calculator instead.

Frequently asked questions