Understanding the Conversion: Hourly to Annual Salary

If you're paid by the hour, you may want to know your equivalent annual salary, or vice versa. The basic formula is straightforward: multiply your hourly rate by the number of hours you work per week, then by 52 (the number of weeks in a year). For a standard full-time week of 37.5 hours, the calculation is:

Annual salary ≈ Hourly rate × 37.5 × 52

For example, at the National Living Wage of £12.21 per hour (2025 rate for workers aged 21 and over), the annual equivalent is roughly £23,809.50. This aligns with the GOV.UK National Living Wage rates.

However, this is a simplified model. Your actual annual pay may differ due to overtime, shift premiums, London weighting, or unpaid leave. The ONS Annual Survey of Hours and Earnings (ASHE) provides the most comprehensive picture of UK earnings. According to the latest ASHE data (April 2025), the median gross annual earnings for full-time employees stood at £39,039, which corresponds to an hourly rate of approximately £19.67 (excluding overtime). This is a useful benchmark for job seekers and employees comparing roles.

Using ONS ASHE Data as a Benchmark

The ONS ASHE survey is based on a 1% sample of employee jobs from HMRC PAYE records. It breaks down earnings by occupation, region, and full-time/part-time status. For April 2025, median weekly earnings for full-time employees were £766.60, a 5.3% increase on the previous year. When adjusted for inflation (using CPIH), real earnings grew by 1.1%.

These figures are provisional but give a reliable indication of typical pay. If you are negotiating a salary or considering a job offer, comparing your hourly rate to the median for your occupation can be insightful. For example, caring, leisure and other service occupations saw the largest growth in median weekly earnings (7.1%), reflecting the impact of the National Living Wage increase.

National Minimum Wage and National Living Wage

The government sets minimum hourly rates that most workers must receive. In April 2025, the rates were:

• £12.21 for employees aged 21 and over (National Living Wage)
• £10.00 for employees aged 18 to 20
• £7.55 for employees aged 16 to 17
• £7.55 for apprentices (under 19 or in first year)

These rates are updated annually. When converting these to annual salaries, remember that part-time workers will earn proportionally less. The GOV.UK website provides full details.

NHS Pay Scales: A Real-World Example

Public sector pay scales offer clear hourly and annual equivalents. For 2026/27, NHS Employers published updated rates. For example, a Band 5 nurse at the entry step earns £38,488 annually, which works out at £19.68 per hour (based on 37.5 hours per week). At the top of Band 5, the annual salary is £46,852, equating to £23.96 per hour. Higher bands, such as Band 8a, start at £66,274 annually (£33.89 per hour). These rates include Higher Cost Area Supplements (HCAS) for London and other high-cost areas, which add a percentage on top of basic pay.

When using these figures to work out your own rate, always check whether your contract includes London weighting or other allowances. The conversion formula remains the same, but the total pay package may be higher.

Overtime and Other Adjustments

The basic conversion assumes a fixed weekly hours and no overtime. In reality, many jobs offer overtime at a higher rate (e.g., time-and-a-half). If you regularly work overtime, your actual annual earnings will be higher than the simple calculation. Conversely, if you are on a zero-hours contract, your annual income may vary significantly.

For a more precise estimate, use our hourly calculator to input your exact hours and rate. You can also explore salary data for your occupation.

London Weighting and Regional Variations

Earnings vary across the UK. The ONS ASHE data shows regional differences, with London typically having higher median pay. When converting an hourly rate to an annual salary, consider whether the role includes a London weighting or cost-of-living supplement. For example, NHS staff in inner London receive a HCAS of 20% of basic salary (subject to minimum and maximum payments). This can significantly increase the annual equivalent.

Part-Time Workers

For part-time employees, the conversion is the same but with fewer hours. For example, if you work 20 hours per week at £15 per hour, your annual salary would be £15 × 20 × 52 = £15,600. The ONS ASHE data provides separate estimates for part-time workers. In April 2025, median hourly pay for part-time employees was lower than for full-time, partly reflecting the types of roles.

Summary

To work out your hourly rate from an annual salary, divide the annual figure by the number of weeks you work (usually 52) and then by your weekly hours. For a full-time employee on 37.5 hours per week, the formula is:

Hourly rate = Annual salary ÷ 52 ÷ 37.5

Conversely, to find the annual salary from an hourly rate, multiply:

Annual salary = Hourly rate × 37.5 × 52

Always use your actual contracted hours and consider any additional payments. The ONS ASHE data and official pay scales provide reliable benchmarks. For more guidance, see our salary articles and topics pages.