The conversion helps compare offers that use different units. If you earn $20 per hour, work 40 hours a week and work 52 weeks a year, the annual estimate is 20 × 40 × 52 = $41,600 gross.
The formula
Weekly pay = hourly wage × weekly hoursAnnual pay = weekly pay × weeks worked
For a 40-hour week across 52 weeks, multiply the hourly rate by 2,080 annual hours. If you work 30 hours a week, the multiplier is 1,560. The useful number is the one that matches the actual schedule in the offer.
Monthly pay is an average
To get a monthly equivalent, divide annual pay by 12. This does not mean each month contains the same number of hours; it is an average for budgeting and comparisons. If you are paid weekly, dividing annual pay by 52 is usually the clearer comparison.
Gross pay, take-home pay and time off
The result is gross pay. Take-home pay depends on taxes, deductions, benefits, location and personal circumstances. Also, 52 paid weeks may not match reality: a contractor, seasonal worker or job with unpaid time off may need a different number of billable weeks.
When comparing offers, record the real hours, paid time off, bonuses, benefits and costs you cover. A higher hourly rate does not always produce more annual income if it comes with fewer hours or more unpaid time.