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MARKETPLACE- Let's do the numbers on CEO pay

Old_JoeOld_Joe
in Other Investing

“Boss makes a dollar, I make a dime” Try a quarter of a cent, these days. Let’s do the numbers on CEO salaries and how they compare to those of employees.
As workers in many industries fight for higher wages, CEO pay has climbed to record highs.

Compensation for chief executive officers rose a staggering 1,460% between 1978 and 2021, according to a 2022 report from the left-leaning Economic Policy Institute.

Among the 350 publicly owned U.S. firms with the largest revenue, CEOs in 2021 made an average of $27.8 million, which includes stock grants and options. The ratio of CEO pay to that of the typical worker stands at 399 to 1. In 1965, the ratio was 20 to 1.

CEO pay has risen exponentially as more of their compensation comes in stock, not cash. Meanwhile, workers’ wages have lagged over the past few decades, failing to keep pace with productivity. The Pew Research Center noted there are a variety of potential reasons for slow wage growth, including the decline of unions, noncompete clauses that prevent workers from getting higher salaries; and jobs shifting from manufacturing and production to low-wage industries.

This gap may be one factor driving the current upsurge in labor activism. Workers in numerous industries are considering going on strike, already on strike or forming unions to fight for better working conditions, higher wages and in some cases the very future of their profession as artificial intelligence threatens to undercut their roles.

We examined Securities and Exchange Commission filings for publicly traded companies in the middle of this unrest — Disney, UPS, United Airlines and others — and tabulated the pay for their chief executives and median-compensated employees. Check out all the numbers here.

Janet Nguyen reported this story from Los Angeles.
☞ MARKETPLACE, 7/2/23

Comments

  • catch22catch22
    edited August 2023
    Thanks for the update.
    HA ! Recall the meetings and newsletters with/from the State, Regional and National corporate MBA's folks who spewed the 'share holder value' and all the other cute phrases and mantras. They never cared to hear that the field staff knew who really paid our wages, being the customers; not the corporation to whom we were employed. Our paychecks were merely a 'pass through' from satisfied customers. Our worker bee 'goal' standards were set so high, that annual review wage increases were almost impossible to obtain. As the internal company promotions continued to decrease (folks who really knew the business) and were given to MBA's folks with their book learning, but no experience, the company eventually faded away into bankruptcy from too many bad decisions. A sad end that didn't have to be. The corporate top took their bonuses and ran away to another gig.
    ADD: The MBA, no experience folks, really started to become a problem in the early to mid-90's.
  • BenWPBenWP
    Sad to think this transformation occurred during the years when I was employed full-time, 1970-2012. In my sector, higher ed, we fought like banshees to get a union recognized, then fought some more every 2-4 years to try to carve out some portion of the pie for our people. By the end of my career, I found myself telling an administrator acting as university president to never refer to me, or anyone else for that matter, as a “stakeholder.” The corporatization happened right under our eyes, and by the time I left, MI was a “Right to Freeload” state and my union was having a hard time finding the resources to do its work. If I and my colleagues held anything, it was the part of the stake with the caca on it.
  • Old_JoeOld_Joe
    Yeah, "stakeholders". My blood pressure goes up a few notches every time I hear that one.
  • FD1000
    edited August 2023
    Nothing new and is especially rampant in the USA. No need to go further than Toyota CEO compared to the USA car company CEOs, while Toyota is a much better company.

    But, the solution is simpler in the US. Join the best stock market in the world and enjoy your retirement, you don't need to make a lot of money, just start young and invest 10+% of your salary in the SP500. The US has the lowest fees and the lowest min to start on mutual funds + ETFs.
  • davidrmorandavidrmoran
    Easy fix by the bosses, easier prevention

    Too long but so eloquent

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