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Hourly Wage After Inflation Calculator

Find out whether your raise beats inflation — the real value of your new hourly wage in today's dollars, and how much a wage would need to be just to keep up.

Wage a year ago

Wage now

Inflation over the period

Hours per week (for annual view)

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How it works

Real wage = new wage ÷ (1 + inflation) · Break-even wage = old wage × (1 + inflation) · Real raise % = new wage ÷ (old wage × (1 + inflation)) − 1

A raise only makes you better off if it outpaces inflation. Dividing your new wage by the inflation factor restates it in last year's dollars, so you can compare it directly to what you used to earn. The break-even wage — your old pay grown by inflation — is the line a raise must clear just to stand still. When nominal pay rises but real pay falls, you have taken a pay cut in everything but the number on the check.

Worked example

Going from $20 to $21 an hour is a 5% nominal raise. With 3.2% inflation, your break-even wage is 20 × 1.032 = $20.64, and your $21 is worth 21 ÷ 1.032 ≈ $20.35 in year-ago dollars — a real raise of about 1.7%. Over a 40-hour week that's roughly $748 more purchasing power a year.

Frequently asked questions

What is the difference between nominal and real raise?

The nominal raise is the headline percentage increase in your pay. The real raise subtracts inflation, showing whether your buying power actually rose. A 5% raise during 5% inflation is a 0% real raise.

What inflation figure should I enter?

Use the CPI change over the same period as your raise — typically the year-over-year rate published by your national statistics office. For a two-year gap, use the cumulative inflation across both years.

My raise is below inflation — what does that mean?

It means your standard of living slipped despite a bigger paycheck: prices rose faster than your pay, so each hour buys less than it did. The break-even wage shows exactly what you'd need to earn to hold even.

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