Calculating Growth Rate: Formula and Examples

To calculate a growth rate, subtract the starting value from the ending value, divide the difference by the starting value, and multiply by 100 to express the change as a percentage. Enter the two values below to get the percentage growth, along with the absolute change.

Formula

The standard growth-rate formula is:

Growth rate (%) = ((ending value − starting value) ÷ starting value) × 100

• Starting value (s): the value at the beginning of the period, in the chosen unit.
• Ending value (f): the value at the end of the period, in the same unit.
• Growth rate: the relative change, expressed as a percentage.
• Absolute change: ending value minus starting value, in the original unit.

The starting value must not be zero, because division by zero is undefined. The calculator accepts nonnegative values; if an application involves negative values, choose a suitable measure and interpret it in context rather than applying the usual percentage formula automatically.

Worked Example

With the calculator’s default values, the starting value is 100 and the ending value is 120:

1. Find the change: 120 − 100 = 20.
2. Divide by the starting value: 20 ÷ 100 = 0.2.
3. Convert to a percentage: 0.2 × 100 = 20%.

The growth rate is 20.00%, and the absolute change is 20. The units of the two input values cancel in the percentage calculation, but both values still need to use the same unit.

What a Growth Rate Tells You

A growth rate describes how large a change is relative to where it began. It is useful for comparing changes across quantities with different scales: a rise of 20 units from 100 is 20%, while a rise of 20 units from 1,000 is 2%. The absolute change is identical, but the relative growth is not.

A positive result means the ending value is greater than the starting value. A negative result means the value fell; this is often called a negative growth rate or a decline rate. A result of zero means there was no net change between the two observations. These interpretations describe the endpoints, not necessarily what happened between them.

Growth rates appear in many settings, including changes in quantities, counts, output, and measurements. The calculation itself does not explain why a value changed or whether the change is meaningful. Those questions require context about the measurement, period, data quality, and factors that may have affected it.

Choose the Right Time Period

The basic formula compares two values, so the period is set by the dates or observations you choose. A change from January to February is a monthly comparison; a change between the beginning and end of a year spans a different period. Always state the interval when reporting a rate, or readers may compare figures that cover unlike periods.

For multiple periods, a simple average of individual growth rates is not always the same as the overall growth rate. If values move from 100 to 120 and then from 120 to 150, the total growth from 100 to 150 is 50%, not the sum of the rounded period percentages. For an average compound rate over equally spaced periods, use the compound annual growth rate (CAGR) formula, or its equivalent for any number of periods:

Average compound rate per period (%) = ((ending value ÷ starting value)^1/n − 1) × 100

Here, n is the number of equal-length periods. This rate is the steady per-period rate that would produce the same total change; it does not claim that the value actually changed steadily. The ordinary growth-rate calculator above compares just two values and does not calculate CAGR.

Common Mistakes and Limits

• Using the ending value as the denominator: the standard formula divides by the starting value. Dividing by the ending value answers a different question.
• Mixing units: convert measurements to a common unit before comparing them. For example, do not compare a length in inches with one in centimeters without conversion.
• Confusing percentage points with percent growth: a change from 10% to 12% is an increase of 2 percentage points. Relative growth in the percentage value is 20%: (12 − 10) ÷ 10 × 100.
• Rounding too early: retain the original values through the calculation and round the displayed result at the end.
• Ignoring a zero or negative baseline: zero makes the standard formula undefined. With a negative starting value, the result can be mathematically calculated in some cases but may not have an intuitive or consistent growth interpretation.
• Assuming the rate proves a cause: the formula measures the change between two values. It cannot identify what caused it, account for measurement error, or show fluctuations between the endpoints.

For currencies or other quantities with both customary and metric-style units, the percentage is unchanged by converting both values consistently; the absolute change is expressed in whichever unit you enter. The calculator’s unit field is left unspecified because the appropriate unit depends on what is being measured.

Frequently Asked Questions

How do I calculate growth rate in Excel?
Put the starting value in one cell and the ending value in another. If the starting value is in A1 and the ending value is in B1, enter =(B1-A1)/A1, then format the result as a percentage. Ensure A1 is not zero.

Can a growth rate be negative?
Yes. If the ending value is lower than the starting value, the standard calculation returns a negative percentage. For example, a change from 100 to 80 is −20%, meaning a 20% decline relative to the starting value.

What if the starting value is zero?
The standard percentage growth rate is undefined because it requires dividing by the starting value. Report the absolute change or use a clearly defined alternative suited to the situation; do not present an ordinary percentage growth rate for that comparison.

Is growth rate the same as percentage change?
For a comparison between a starting and ending value, growth rate and percentage change commonly use the same formula. “Growth” often implies an increase, while “percentage change” can describe either an increase or a decrease.

How do I calculate average growth over several years?
If you want the steady compound rate across equal annual intervals, use ((ending value ÷ starting value)^1/n − 1) × 100, where n is the number of years. This differs from taking the arithmetic average of yearly percentages.

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in s | Starting value | - | 100 | 0
in f | Ending value | - | 120 | 0
out growth | Growth rate | % | ((f - s) / s) * 100 | 2
out change | Absolute change | - | f - s | 2