Percentage increase measures a change relative to the original value. Percentage points measure the direct difference between two percentages. They are not interchangeable.
The distinction matters when discussing rates, margins, survey results, interest rates, and any value already expressed as a percentage.
How percentage increase works
Subtract the original value from the new value, divide the difference by the original value, and multiply by 100. The original value is the base, so reversing the numbers changes the result.
- Percentage change = (new − original) ÷ original × 100
- A positive result is an increase.
- A negative result is a decrease.
How percentage points work
When both values are percentages, subtract the old percentage from the new percentage. A rate that rises from 20% to 25% increases by 5 percentage points.
Why the two answers differ
A rise from 20% to 25% is 5 percentage points, but it is a 25% relative increase because the 5-point change is one quarter of the original 20% rate.
Common questions
Questions about this topic
What is the difference between percent and percentage points?
Percent describes a relative change or portion. Percentage points describe the direct arithmetic difference between two percentages.
Can a percentage decrease exceed 100%?
A normal decrease from a positive value cannot fall below zero, so it cannot exceed 100%. Other percent-change situations, such as moving between negative values, need careful interpretation.
Why does reversing the values change percent change?
The original value is the denominator. Changing the starting value changes the base used for comparison.