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Yesterday, while telling an anecdote, me and my dad had the following conversation:
Me: ...and our bonuses were about 20% of annual salary, so phasing them out without any salary increase was really like a 16% pay cut over a few years!
Dad: See, you just totally betrayed your math major status.
Me: Huh?
Dad: Not one person in 50 would have done the conversion from 20% to 16% right there. I don't think even I would have.
I was a bit startled. A 16% pay cut is not the same as a 20% pay cut! And losing a bonus worth 20% of base salary is not a 20% cut! You've been getting 120%, you're now getting 100%, that's a 1/6 cut! How many people out there would have made the translation versus not made the translation?
Me: ...and our bonuses were about 20% of annual salary, so phasing them out without any salary increase was really like a 16% pay cut over a few years!
Dad: See, you just totally betrayed your math major status.
Me: Huh?
Dad: Not one person in 50 would have done the conversion from 20% to 16% right there. I don't think even I would have.
I was a bit startled. A 16% pay cut is not the same as a 20% pay cut! And losing a bonus worth 20% of base salary is not a 20% cut! You've been getting 120%, you're now getting 100%, that's a 1/6 cut! How many people out there would have made the translation versus not made the translation?