The percentage point calculator is a simple tool to find the percentage point difference between two percentages. In addition, you can also learn what a percentage point is and how to calculate the difference in points. Enter your two percentages above and the calculator instantly returns the percentage point difference, the equivalent number of basis points, and the relative percent change.
Read further — we answer the following questions:
- What is a percentage point (percent vs. percentage point)?
- How do you calculate percentage points?
- What is the difference between percentage points and percent?
- How do you convert basis points into percentages?
What is a percentage point?
A percentage point (or percent point) is the unit for the arithmetic difference of two percentages. For example, climbing from 20 percent to 25 percent indicates a 5 percentage point increase, but a 25-percent increase (or percentage difference) of the given values. You may often find the unit written in its complete form (point or points) or with a percentage points abbreviation, typically p.p. or pp.
We can also state an absolute change in terms of percentage points — for example, the value of an indicator in period 2 minus its value in period 1.
How do you calculate percentage points?
Calculating percentage points is a straightforward mathematical operation: you take the arithmetic difference of the two percentages. Let's take a simple example: the unemployment rate was 5 percent in 2019 and 7 percent in 2020.
- Highlight the percentages you need to compare:
- 2019 (Percentage #1): 5%
- 2020 (Percentage #2): 7%
- Subtract Percentage #1 from Percentage #2:
Percentage points = Percentage #2 − Percentage #1 = 7 − 5 = 2
- Add the unit (percentage point) and the direction of the change (increase if positive, decrease if negative, or simply state it as a difference):
There was a 2 percentage point increase in the unemployment rate from 2019 to 2020. Alternatively, there is a 2 percentage point difference between the unemployment rates in 2019 and 2020.
Percentage points vs. basis points
A basis point (bp) is one hundredth of a percentage point. In other words:
- 1 percentage point = 100 basis points
- 0.01 percentage point = 1 basis point
So a change from 5% to 7% — a 2 percentage point increase — is the same as a 200 basis point increase. Basis points are especially popular in finance, where interest rates and yields move in very small increments.
FAQs
- What is the difference between percentage points and percent?
- Both are frequently used, but it's essential to distinguish the two, as they mean different things. Suppose the unemployment rate increased from 4% to 6% — that's a 50 percent increase (because 2 ÷ 4 = 50%), but only a 2 percentage point increase. Percentage points measure the absolute gap between two percentages, while percent measures the relative change.
- How do you convert basis points into percentages?
- Divide the number of basis points by 100 to get percentage points. For example, 250 basis points = 2.5 percentage points. Since a basis point is simply a different unit for a percentage difference, percentage points and basis points describe the same idea at different scales.
- Is a change from 20% to 25% a 5% increase?
- No. It is a 5 percentage point increase, but a 25 percent increase, because 5 ÷ 20 = 25%. Mixing up the two units is one of the most common mistakes when reading statistics.
- Can the percentage point difference be negative?
- Yes. If the second percentage is smaller than the first, the difference is negative, which represents a decrease. This calculator reports the direction (increase, decrease, or no change) alongside the value.
- Are percentage points and percentage difference the same?
- When comparing two percentages, the percentage point difference is simply their subtraction (P₂ − P₁). This is different from a percentage change, which divides that difference by the original value and multiplies by 100.