Guide
How to compare two job offers by real hourly wage
The offer with the bigger salary isn't always the one that pays you more. Long commutes, unpaid overtime and work costs can make a higher salary worth less per hour of your life.
Step 1: Count all the hours each job takes
For each offer, add up a typical week:
- Paid hours
- Unpaid overtime you'd realistically do
- Commute, both ways
Step 2: Subtract what each job costs you
Fares or fuel, parking, work clothes, meals bought because you're at the office, and childcare for longer days.
Step 3: Use take-home pay
Estimate the take-home pay for each offer. If one has better benefits, such as health insurance you'd otherwise pay for, add that value back.
Step 4: Divide
real hourly wage = (take-home pay − work costs + benefit value) ÷ total hours
An example
| Offer A | Offer B | |
|---|---|---|
| Take-home per month | 28,000 | 24,000 |
| Work costs per month | 4,000 | 1,000 |
| Work hours per month | 176 | 176 |
| Commute hours per month | 66 | 11 |
| Real hourly wage | 99.17 | 122.99 |
Offer A pays 4,000 more a month, but with a 3-hour daily commute and higher costs, Offer B pays about 24% more per hour of your time. Offer B also gives back 55 hours a month.
Things the maths doesn't capture
Career growth, what you'd learn, job security and how much you'd enjoy the work all matter. Use the real hourly wage as one clear number to weigh against them, not the only one.
For more on the method, see how to work out your real hourly wage.