How to Calculate Your Hourly Rate from a Daily Rate
In the world of freelancing, contracting, and professional consulting, the "day rate" is a standard pricing model. However, comparing a daily rate to a traditional salary or understanding your actual earning efficiency requires converting that figure into an hourly rate.
The Basic Mathematical Formula
At its simplest, the calculation for an hourly rate is dividing the total amount earned in a day by the number of hours worked:
Hourly Rate = Daily Rate ÷ Hours Worked
Accounting for Unpaid Breaks
Many professionals forget to account for unpaid downtime, such as lunch breaks. If you are on a "8-hour shift" but take a 1-hour unpaid lunch, your actual productive hours are 7. This significantly changes your net hourly value.
Step-by-Step Calculation:
Subtract your break time (in hours) from your total shift length.
Divide your total daily pay by this "net" hour figure.
When you are bidding for contracts, clients often compare vendors using different metrics. By knowing your hourly rate, you can more accurately estimate project timelines and ensure you aren't underpricing your services compared to industry standards. For example, a $400 day rate might sound high, but if the project requires 12-hour days, your hourly rate drops to $33.33, which may be below market value for your expertise.
Common Daily to Hourly Conversion Table (Based on 8-Hour Day)
Daily Rate
Hourly (8h)
Hourly (7.5h)
$200
$25.00
$26.66
$400
$50.00
$53.33
$600
$75.00
$80.00
$800
$100.00
$106.66
function calculateHourlyRate() {
var dailyRate = parseFloat(document.getElementById("dailyRate").value);
var hoursWorked = parseFloat(document.getElementById("hoursWorked").value);
var breakMinutes = parseFloat(document.getElementById("breakTime").value) || 0;
if (isNaN(dailyRate) || isNaN(hoursWorked) || hoursWorked <= 0) {
alert("Please enter a valid daily rate and working hours.");
return;
}
// Calculation for Gross (total hours)
var grossHourly = dailyRate / hoursWorked;
// Calculation for Net (hours minus breaks)
var breakHours = breakMinutes / 60;
var netHours = hoursWorked – breakHours;
if (netHours <= 0) {
alert("Break time cannot be greater than or equal to working hours.");
return;
}
var netHourly = dailyRate / netHours;
// Annualized calculation (260 working days per year)
var annualSalary = dailyRate * 260;
// Display Results
document.getElementById("grossHourly").innerText = "$" + grossHourly.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("netHourly").innerText = "$" + netHourly.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("annualSalary").innerText = "$" + annualSalary.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resultDisplay").style.display = "block";
}