Pay Cut Calculator
See what a pay cut means in money: new annual salary, pay lost per year and month, the raise needed to get back to your old pay and your hourly rate if your hours are reduced too.
How it works
new salary = salary × (1 − cut %) · pay lost = salary − new salary · raise needed to recover = salary ÷ new salary − 1 · hourly rate = salary ÷ (weekly hours × 52)
A percentage cut and the raise that undoes it are not the same number, because the raise is calculated on the smaller salary: a 10% cut needs an 11.11% raise to recover, a 20% cut needs 25%. If your hours are reduced along with your pay — for example a four-day week at 80% pay — your hourly rate can stay the same or even rise, which is why the calculator shows both. Before agreeing to a cut, compare it with the effect on benefits, pension contributions and overtime that are calculated from base pay.
Worked example
A 10% pay cut on a $60,000 salary gives a new annual salary of $54,000.00: you lose $6,000.00 a year or $500.00 a month, and it would take an 11.11% raise to get back to your old pay. With hours unchanged at 40 a week, your hourly rate drops from $28.85 to $25.96, a change of -10.00%.
Sources: US Department of Labor — Wages · GOV.UK — Changing an employment contract
Frequently asked questions
How do I calculate a pay cut percentage?
Divide the amount of the cut by your old pay: a drop from $60,000 to $54,000 is 6,000 ÷ 60,000 = 10%.
Why does a 10% cut need an 11.11% raise to recover?
The raise is applied to the lower salary. 54,000 × 1.1111 = 60,000. The deeper the cut, the bigger the gap: a 50% cut needs a 100% raise.
Is a pay cut with fewer hours a real pay cut?
Your income falls, but your pay per hour may not. A 20% cut with 32 instead of 40 hours keeps the same hourly rate; a 10% cut with the same hours lowers it by 10%.
Can my employer cut my pay?
It depends on your contract and local employment law. In many places a pay cut needs your agreement or advance notice; check your contract and your labour authority.
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Planning estimate only — not legal, tax or payroll advice. Employment contracts, labour law and tax rules differ by country and employer; check your contract, your payslip or a qualified adviser.