CEOs had enormous pay raises last year
CEO pay rose a staggering 17% in 2021 for S&P 500 companies (in addition to their raises the previous year). Regular worker pay? Just 4%.
The details: The AP recently reported in their study of 340 CEOs from S&P 500 companies, even with the high profits of S&P 500 companies and their executive bonuses, worker pay doesn’t meet inflation and regular workers are upset about it.
“The chasm in pay between CEOs and the rank-and-file workers they oversee keeps widening. At half the companies in this year’s pay survey, it would take the worker at the middle of the company’s pay scale at least 186 years to make what their CEO did last year.”
Go deeper: The jump in CEO pay is primarily due to the economic bounce back from 2020 where CEO pay raises were at a median 5%. Yes, these CEOs had to navigate the Everything Shortage, and yes some companies didn’t make it. These particular CEOs are getting paid more than most of us would think is reasonable.
More importantly, the gap in pay has never been wider between executives and entry-level staff. If it takes a rank-and-file worker 168 years to make what their CEO receives in one year, we’re beyond the pale of reasonable executive compensation. So here’s another friendly reminder that your boss’ boss’ boss’ boss’ boss makes way way way way more than you can even imagine. Your frustration is understandable.
Why it matters: If you perform well at your job every year, your pay should be increasing at more than the rate of inflation. So if you made 100K last year, you deserve to make more than $107,000 this year. If your job isn’t delivering on better pay, look for a new company that would be elated to pay you more to work for them instead. And you’re not alone: many us are leaving jobs for better pay as inflation hits our wallets hard this year.
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