How to Calculate Percentage Increase or Decrease
The exact formula for percent change, why order and direction matter, and worked examples covering raises, price hikes, discounts, and investment losses.
Percentage increase and decrease use the same formula — only the sign of the result changes: ((new value − original value) ÷ original value) × 100. A positive result is an increase; a negative result is a decrease.
Worked example: a raise
Your salary goes from $52,000 to $56,680. The change is $4,680. Divide by the original: 4,680 ÷ 52,000 = 0.09. Multiply by 100: a 9% raise.
Worked example: a price drop
A laptop drops from $1,200 to $960. The change is −$240. Divide by the original: −240 ÷ 1,200 = −0.20. Multiply by 100: a 20% decrease.
Why the original value is always the denominator
It's tempting to divide by whichever number seems more convenient, but percent change specifically measures how far you've moved relative to where you started — so the starting point has to be the base of the comparison. This is also why increases and decreases of the same percentage don't cancel out.
The classic trap: up 20%, then down 20%, isn't back to zero
Start at $100. A 20% increase adds $20, giving $120. Now apply a 20% decrease — but 20% of what? Percent change always uses the current value as the base, so it's 20% of $120 = $24, not 20% of the original $100. The result is $120 − $24 = $96, a net 4% loss from where you started, even though the two percentages look like they should offset.
- Investment losses recover harder than they were lost: a 50% loss requires a 100% gain just to break even, since losing half of $100 leaves $50, and $50 needs to double to get back to $100.
- Compounding changes aren't additive: two successive 10% increases don't equal a 20% increase — they equal a 21% increase (1.10 × 1.10 = 1.21).
Use the Percentage Calculator's "% change" tab to get the exact increase or decrease between any two numbers, including the direction and the absolute difference.