Why 2,080 is the number everyone uses
Forty hours a week times fifty-two weeks is 2,080 hours, and that product is the standard denominator for turning a salary into an hourly rate across US payroll, budgeting and government pay tables. Divide a $60,000 salary by 2,080 and you get $28.85 an hour. That is the number a recruiter means by "about twenty-nine an hour", and it is the number you should use when comparing two salaried offers.
It is also, for most salaried employees, slightly wrong as a measure of what an hour of your work is worth — because you do not work 2,080 hours. Subtract two weeks of public holidays and three weeks of vacation and you work 47 weeks, or 1,880 hours, while still being paid for all 52. Your pay per hour actually worked is $60,000 ÷ 1,880 = $31.91, about 11% higher than the nominal figure.
Both numbers are correct answers to different questions. Use the nominal rate to compare pay levels and to convert between forms. Use the effective rate when you are deciding whether to take a contract, because a contractor billing hourly gets paid only for hours worked and has to cover unworked weeks out of the rate itself. The gap between the two is exactly the value of your paid time off, expressed as a rate.
Some employers use 2,087 hours instead of 2,080. That figure is the average over a 28-year cycle of the actual number of work hours in a year — 261 or 262 weekdays depending on how the calendar falls — and the US federal government uses it to convert annual General Schedule salaries to hourly rates. The difference is about a third of a percent, immaterial for comparison and material only for exact payroll conversions.
Choosing the right denominator for the question you are asking
Every disagreement about salary-to-hourly conversion is a disagreement about the denominator. There are only three sensible choices, and each answers a different question.
Scheduled hours (h × 52). This gives the nominal rate. It is the right denominator when you are comparing offers, sizing an overtime rate, or reporting a wage figure, because it treats paid leave the same way the salary does — as part of the annual package rather than as time off.
Hours actually worked (h × (52 − v − u)). This gives the effective rate. It is the right denominator when you are pricing your time: setting a freelance rate, deciding whether a side project is worth doing, or comparing an employee role against contract work.
Hours in the specific pay period. This is what payroll uses, and it is why a semimonthly employee's hourly conversion is untidy. Twenty-four semimonthly periods of 86.67 hours each reproduce 2,080; twenty-six biweekly periods of 80 hours each also reproduce 2,080. Both are correct, but only the biweekly one gives round numbers.
The unpaid time off input changes something the other two do not: it reduces your annual pay. A four-week unpaid summer shutdown on a $52,000 salary leaves you with $52,000 × 48 ÷ 52 = $48,000 while your nominal hourly rate stays at $25.00, because the rate was never a function of how many weeks you were paid. That is why the calculator reports annual pay separately from the salary you entered.
One direction deserves care. Going from hourly to salary, multiply by hours per week and by the weeks you are actually paid — 52 if your leave is paid, fewer if it is not. An hourly employee with unpaid leave who multiplies by 52 will overstate annual earnings by the value of every week they take off.
Worked example: a $100,000 salary with four weeks of paid leave
You are offered $100,000 a year for a 40-hour week, with four weeks of combined vacation and holidays, all paid.
- Scheduled hours. 40 h × 52 weeks = 2,080 hours.
- Nominal hourly rate. 100,000 ÷ 2,080 = $48.0769 per hour.
- Weeks actually worked. 52 − 4 = 48 weeks.
- Hours actually worked. 40 × 48 = 1,920 hours.
- Effective rate per hour worked. 100,000 ÷ 1,920 = $52.0833 per hour.
- The gap. 52.0833 ÷ 48.0769 = 1.0833, so paid leave is worth 8.33% on your rate. That is exactly 4 ÷ 48 — the unworked weeks divided by the worked ones.
- Weekly pay. 100,000 ÷ 52 = $1,923.08. Monthly pay. 100,000 ÷ 12 = $8,333.33.
Now use it. A contractor asked to cover the same role at an hourly rate, taking the same four weeks off unpaid, needs at least $52.08 an hour just to reach the same gross income — and that is before employer payroll taxes, health cover and the absence of any employer retirement match. Adding the employer's 7.65% FICA alone takes the break-even to about $56.07, since a self-employed person pays both halves through self-employment tax. The full comparison belongs in the self-employment tax calculator, but the $52.08 figure is the floor, not the target.
Run the same example at 45 hours a week and the picture changes sharply: scheduled hours become 2,340, the nominal rate falls to $42.7350, and the effective rate to $46.2963. Nothing about the offer changed except the hours you actually work, which is why the hours field matters more than any other input on this page.
Common salaries as hourly rates at a 40-hour week
| Annual salary | Nominal hourly | Weekly | Monthly | Effective hourly (4 weeks PTO) |
|---|---|---|---|---|
| $30,000 | $14.4231 | $576.92 | $2,500.00 | $15.6250 |
| $40,000 | $19.2308 | $769.23 | $3,333.33 | $20.8333 |
| $50,000 | $24.0385 | $961.54 | $4,166.67 | $26.0417 |
| $60,000 | $28.8462 | $1,153.85 | $5,000.00 | $31.2500 |
| $75,000 | $36.0577 | $1,442.31 | $6,250.00 | $39.0625 |
| $100,000 | $48.0769 | $1,923.08 | $8,333.33 | $52.0833 |
| $150,000 | $72.1154 | $2,884.62 | $12,500.00 | $78.1250 |
Every effective figure is exactly 2,080 ÷ 1,920 = 1.08333 times the nominal one, because the ratio depends only on the time off, not on the salary.
Using the result to compare offers honestly
An hourly conversion only compares two roles fairly when the hours are honest. A $95,000 job at a genuine 40 hours and a $110,000 job at a real 55 hours convert to $45.67 and $38.46 respectively — the higher salary is the lower rate, by 16%. That comparison is invisible on the salary figures alone, and it is the single most useful thing this calculator does.
Next, adjust for what the salary does not include. Employer retirement matching, health premium subsidy, and paid leave are all real compensation. A 5% match on $95,000 is $4,750, which adds $2.28 an hour at 2,080 hours. Health cover an employer funds at $600 a month is $7,200 a year, or $3.46 an hour. Those two together can outweigh a $10,000 salary difference.
Then check the classification. If a role is non-exempt, hours past 40 in a workweek carry a time-and-a-half premium and the salary conversion understates what a long week actually pays — the overtime pay calculator handles that side. If the role is exempt, extra hours are unpaid and every hour above 40 pushes the effective rate down with no offset at all.
Finally, remember that all of these figures are gross. Two identical salaries in different states produce different take-home pay, and pre-tax benefits change the comparison again. Run the finalists through the gross to net paycheck calculator before deciding, and if the roles pay on different cycles, use the pay period conversion calculator so you are comparing the same unit of time.
Mistakes that make an hourly conversion misleading
- Using the contracted hours instead of the worked hours. A salary divided by the hours on the job description flatters any role where 50-hour weeks are the norm.
- Dividing by 2,000 for convenience. It overstates the rate by 4%, which is more than most annual raises.
- Multiplying an hourly rate by 2,080 to price contract work. A contractor works fewer weeks, pays both halves of FICA, and buys their own benefits. Use the effective rate as the floor and add loadings on top.
- Treating monthly pay as four weekly paychecks. A month averages 4.33 weeks. Weekly pay × 4 understates monthly pay by 7.7%.
- Ignoring unpaid shutdowns. They reduce annual pay without changing the hourly rate, so the salary figure alone overstates what you receive.
- Comparing a gross salary against a net hourly take-home. Convert both to the same basis before comparing, or the difference you are measuring is mostly tax.
- Forgetting that paid leave has to be earned before it exists. An offer with five weeks of vacation that accrues over three years is not worth five weeks in year one; the accrual pattern is what the PTO accrual calculator models.
Salary does not decide whether overtime is owed
Being paid a salary does not make an employee exempt from overtime. Exemption under the Fair Labor Standards Act requires both a salary at or above a threshold and a primary duty that fits one of the narrow tests in 29 CFR Part 541. A salaried non-exempt employee is owed a premium for hours past 40 in a workweek, computed on a regular rate derived from the salary divided by the hours it is meant to cover. If you are salaried, work long weeks and receive no premium, the hourly conversion on this page is worth checking against the exemption tests rather than against the offer letter.
Where the conversion appears beyond job offers
Hourly conversion runs through several calculations that have nothing to do with negotiating pay. Cost accounting uses it to load labour into a job estimate, usually taking the effective rate rather than the nominal one and then adding a burden factor for payroll taxes, benefits and non-productive time — a fully burdened rate of 1.25 to 1.4 times base pay is a common planning rule of thumb, though the actual multiplier depends entirely on the benefit package and should be computed rather than assumed.
Workers compensation premiums are quoted per $100 of payroll, so an hourly rate combined with expected hours gives the exposure base directly; the workers comp premium calculator takes payroll rather than rates for exactly that reason. Grant budgets and government contracts often require an hourly rate derived from a salary using a stated annual hours figure, and the figure they specify — 2,080, 1,920 or 2,087 — changes the billable rate by several percent, so read the instructions rather than defaulting.
For personal budgeting, the effective rate is the more useful of the two. Knowing that an hour of your working time is worth $52 makes decisions about commuting, outsourcing chores and side work concrete rather than vague. It is also a sanity check on unpaid overtime: an exempt employee working five extra hours a week is donating 5 × 48 = 240 hours a year, which at $52 an hour is $12,480 of unpaid labour — a figure worth having in mind before agreeing to a schedule.