How to Calculate Percentage Change: Increase or Decrease

Learning how to calculate percentage change is an essential maths skill used in everyday life, education, business, finance and work. Percentage change helps you understand how much a value has increased or decreased compared with its original amount. For example, you might use it to calculate a change in price, compare monthly sales, measure changes in income or understand how a quantity has changed over time.

The calculation is straightforward once you know which numbers to use. The key is to compare the difference between the original value and the new value with the original value. This guide explains the percentage change formula, how to calculate percentage increases and decreases, and provides simple examples to make the process easy to understand.

What Is Percentage Change?

Percentage change measures the relative difference between an original value and a new value.

It can tell you whether something has:

For example, if the price of an item rises from £50 to £60, the value has increased by £10. However, saying it increased by £10 does not tell you the size of the increase relative to the original price.

The percentage change is 20%, which provides a clearer comparison.

How to Calculate Percentage Change

The standard formula for calculating percentage change is:

Percentage Change = (New Value − Original Value) ÷ Original Value × 100

The formula can produce either a positive or negative result.

Simple Percentage Change Example

Suppose a product originally cost £80 and now costs £100.

First, calculate the difference:

£100 − £80 = £20

Then divide the difference by the original value:

£20 ÷ £80 = 0.25

Finally, multiply by 100:

0.25 × 100 = 25%

Therefore, the price increased by 25%.

How to Calculate Percentage Increase

A percentage increase occurs when the new value is greater than the original value.

The formula is:

Percentage Increase = (Increase ÷ Original Value) × 100

The increase is calculated by subtracting the original value from the new value.

Example of Percentage Increase

A monthly salary increases from £2,000 to £2,300.

Step 1: Find the increase

£2,300 − £2,000 = £300

Step 2: Divide by the original salary

£300 ÷ £2,000 = 0.15

Step 3: Convert to a percentage

0.15 × 100 = 15%

The salary increased by 15%.

How to Calculate Percentage Decrease

A percentage decrease occurs when the new value is lower than the original value.

The formula is:

Percentage Decrease = (Decrease ÷ Original Value) × 100

First, subtract the new value from the original value to find the decrease.

Example of Percentage Decrease

A jacket’s price falls from £120 to £90.

Step 1: Find the decrease

£120 − £90 = £30

Step 2: Divide by the original price

£30 ÷ £120 = 0.25

Step 3: Convert to a percentage

0.25 × 100 = 25%

Therefore, the price decreased by 25%.

Percentage Change Formula

For quick reference, the main formula is:

Percentage Change = [(New Value − Original Value) ÷ Original Value] × 100

For an increase:

Percentage Increase = [(New Value − Original Value) ÷ Original Value] × 100

For a decrease:

Percentage Decrease = [(Original Value − New Value) ÷ Original Value] × 100

The most important point to remember is that the original value is the denominator.

Why Is the Original Value Important?

Using the original value is essential because percentage change measures the change relative to where you started.

Consider a price that rises from £40 to £50.

The difference is £10.

If you divide £10 by £40:

£10 ÷ £40 × 100 = 25%

The increase is therefore 25%.

If you incorrectly divided by the new value:

£10 ÷ £50 × 100 = 20%

you would get a different answer.

For standard percentage-change calculations, always use the original value as the reference point.

Percentage Change Examples

Here are several examples to help reinforce the calculation.

A positive result represents an increase, while a negative result represents a decrease.

How to Calculate Percentage Change Between Two Numbers

When you need to compare two numbers, follow these four steps:

Step 1: Identify the original value.

This is the starting number.

Step 2: Identify the new value.

This is the number you are comparing with the original.

Step 3: Find the difference.

Subtract the original value from the new value.

Step 4: Divide by the original value and multiply by 100.

This gives you the percentage change.

Example

A company’s sales increase from £25,000 to £30,000.

Difference:

£30,000 − £25,000 = £5,000

Percentage change:

£5,000 ÷ £25,000 × 100 = 20%

The company’s sales increased by 20%.

How to Calculate Percentage Change in Excel

You can also calculate percentage change using Microsoft Excel or similar spreadsheet software.

If the original value is in cell A2 and the new value is in B2, you can use:

=(B2-A2)/A2

Then format the result as a percentage.

For example:

This can be particularly useful when working with large datasets or calculating changes across multiple rows.

How to Calculate Percentage Difference vs Percentage Change

Percentage change and percentage difference are related but are not always the same calculation.

Percentage change normally compares a new value with an original or starting value.

Percentage difference is generally used when comparing two values without treating either one as the starting point.

For example, if you are comparing two measurements rather than measuring an increase or decrease from an original measurement, a different formula may be appropriate.

Understanding which calculation a question is asking for is therefore important before choosing a formula.

Common Percentage Change Mistakes

Percentage calculations can be simple, but several common mistakes can lead to incorrect answers.

Using the New Value Instead of the Original

The standard percentage-change formula uses the original value as the reference point.

Forgetting to Multiply by 100

A decimal such as 0.2 represents 20% when converted into percentage form.

Mixing Up Increase and Decrease

Check whether the new value is higher or lower than the original before interpreting the result.

Rounding Too Early

When working with decimals, keep enough decimal places during the calculation and round the final answer when appropriate.

Ignoring the Context

A mathematical result should be interpreted in relation to the question. For example, a result of −15% means a decrease of 15%, not an increase of −15%.

Can Percentage Change Be Greater Than 100%?

Yes. A percentage increase can be greater than 100%.

For example, suppose a value rises from £50 to £150.

The increase is:

£150 − £50 = £100

Percentage increase:

£100 ÷ £50 × 100 = 200%

Therefore, the value increased by 200%.

A decrease, however, cannot normally exceed 100% when the values represent quantities that cannot fall below zero. A 100% decrease means the original value has fallen to zero.

Percentage Change in Everyday Life

Percentage change is useful in many situations.

Shopping

You can calculate how much a sale price has decreased from the original price.

Personal Finance

Percentage change can help compare changes in income, expenses, savings or investment values.

Business

Businesses use percentage changes to analyse sales, revenue, costs, customer numbers and other performance measures.

Education

Students regularly encounter percentage-change calculations in mathematics and functional skills assessments.

Employment

Percentage calculations can be useful when working with budgets, reports, targets, statistics and financial information.

How to Check Your Percentage Change Answer

After calculating a percentage change, you can check whether the answer makes sense.

For example, if a value increases from 100 to 120, the difference is 20. Since 20 is one-fifth of 100, the percentage increase should be 20%.

You can also work backwards.

If £80 increases by 25%:

£80 × 25% = £20

Then:

£80 + £20 = £100

This confirms that an increase from £80 to £100 represents a 25% increase.

Practice Questions

Try these percentage-change questions yourself:

Question 1: A product increases from £40 to £50. What is the percentage increase?

Question 2: A price falls from £200 to £160. What is the percentage decrease?

Question 3: A company’s monthly sales increase from £10,000 to £12,500. What is the percentage change?

Question 4: A student’s test score changes from 60 to 72. What is the percentage increase?

Answers

Question 1: 25%

Question 2: 20%

Question 3: 25%

Question 4: 20%

Practising different examples is one of the best ways to become comfortable with percentage calculations.

Frequently Asked Questions

Final Thoughts

Knowing how to calculate percentage change is a valuable mathematical skill that can be applied to prices, salaries, sales, budgets, measurements and many other real-world situations.

The key formula to remember is:

Percentage Change = (New Value − Original Value) ÷ Original Value × 100

Always identify the original value first, calculate the difference, divide by the original value and then convert the result into a percentage. With regular practice, percentage increases and decreases become much easier to calculate accurately.