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Wage Index Calculator

Formula

The formula to calculate the Wage Index (WI) is:

$\text{WI} = \text{NAWI} + \left( \frac{\text{NAWI} \times \text{CW2}}{100} \right)$

Where:

$\text{WI}$ is the Wage Index ($)
$\text{NAWI}$ is the previous year's national average wage index ($)
$\text{CW2}$ is the average change in wages of the previous two years (%)

What is the Wage Index?

The Wage Index (WI) is a measure used to adjust wages to reflect changes in the national average wage index (NAWI) and the average change in wages over a specified period. This index helps to understand wage trends and make necessary adjustments in salaries, benefits, or other wage-related calculations based on historical data. It is particularly useful for economic analyses and policy-making.

Example Calculation

Let's assume the following values:

Previous Year's National Average Wage Index (NAWI) = $50,000
Average Change in Wages of the Previous Two Years (CW2) = 3%

Using the formula to calculate the Wage Index:

$\text{WI} = 50000 + \left( \frac{50000 \times 3}{100} \right) = 50000 + 1500 = 51500$

The Wage Index is $51,500.