Wage to Salary

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What is “wage to salary”? 

Wage to salary refers to a method of converting how much an hourly worker would earn if they are paid an equivalent salary. In other words, wage to salary is a calculation that answers the question: how much would an hourly wage amount to if it were paid via salary? 

Because wage to salary is merely a conversion, this does not change the worker’s income. It just shows the income given in a different form than before. The reason why wage to salary conversions are done is to give hourly workers a different perspective on how their wages stand against the salaries of other employees. Doing wage to salary conversions also allows employers to compare hourly and salaried employees when it comes to pay and work. 

How do you calculate wage to salary?

If you are an hourly employee and are curious to know what your income will be via salary, you’ll need to learn wage to salary conversion. Here are the steps to follow: 

  1. Multiply the number of hours that you work per week by your hourly wage. This will give you your earnings for one week. 
  2. Multiply the number derived from Step 1 by 52 which is the number of weeks in a year. This will give you your equivalent yearly income. 

Please note that this is a basic conversion and does not take into account bonuses, holiday pay, and other adjustments.

Let’s apply the steps to an example: 

John works as a sales officer for 40 hours per week. His hourly rate is $25 per hour. 

$25 × 40 hours = $1,000 per week

$1,000 × 52 weeks = $52,000

John’s equivalent salary is $52,000 a year. 

How do you calculate salary to wage? 

This is the opposite of salary to wage where you will find out your equivalent hourly wage from your annual salary. Here are the steps to follow: 

  1. Multiply the number of hours that you work each day by the number of days that you work in a year. This will give you the number of hours that you work per year. 
  2. Divide the number derived in Step 1 by your annual salary. This will give you your hourly wage.

Let’s take a look at an example.

Elizabeth has an annual salary of $75,000. She works 8 hours a day for 240 days per year. What is Elizabeth’s hourly wage? 

8 hours × 240 days = 1,920 hours a year

$75,000 ÷ 1,920 hours = $39.06

Elizabeth’s hourly wage is $39.06. Again, this calculation does not consider payroll deductions for taxes and other deductibles.

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