CEO Pay Continues to Rise as Typical Workers Are Paid Less
Report

CEO Pay Continues to Rise as Typical Workers Are Paid Less

Lawrence Mishel and Alyssa Davis
EPI, 2014
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Editorial Rating

8

Qualities

  • Analytical
  • Scientific
  • Eye Opening

Recommendation

The large and growing gap between America’s middle class and its top earners is no longer news. Chief executive officers’ pay, in particular, has risen far faster than that of other employees, including high earners. Economists Lawrence Mishel and Alyssa Davis illustrate in raw numbers how CEOs are getting a disproportionate share of the wage pie and what the broader impact on society might be. getAbstract recommends their report to shareholders, investors and especially board members who decide on executive compensation.

Summary

The past few decades have been particularly profitable ones for chief executive officers of the 350 highest-earning public companies in the United States, especially when compared to the vast majority of workers. In 2013, CEO compensation (including exercised stock options) at these firms averaged $15.2 million, an increase of nearly 22% from 2010. CEO pay grew at an inflation-adjusted 937% from 1978 to 2013, eclipsing the 10.2% wage rise of a “private sector production/nonsupervisory worker.” In 1965, CEOs made 20 times more than average workers. In 2000, the “CEO-to-worker compensation ratio” had jumped to an astounding...

About the Authors

Lawrence Mishel is president of the Economic Policy Institute, where Alyssa Davis is a fellow.

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