Home / Uncategorized / CEOs Still Doing Fine

CEOs Still Doing Fine

The EPI has detailed report on CEO pay, CEO pay remains high relative to the pay of typical workers and high-wage earners. The article includes data, such as the ratio of CEO-to-worker pay that was used to create the graph here. Although the ratio has decreased since its peak of 347.5 in 2007, it was still a healthy 270.5 in 2016, which is over 10 times the 20 it was in 1965.  From the report:

From 1978 to 2016, inflation-adjusted compensation, based on realized stock options, of the top CEOs increased 937 percent, a rise more than 70 percent greater than stock market growth and substantially greater than the painfully slow 11.2 percent growth in a typical worker’s annual compensation over the same period. CEO compensation, when measured using the value of stock options granted, grew more slowly from 1978 to 2016, rising 807 percent—a still-substantial increase relative to every benchmark available.

Over the last three decades, compensation, using realized stock options, for CEOs grew far faster than that of other highly paid workers, i.e., those earning more than 99.9 percent of wage earners. CEO compensation in 2015 (the latest year for data on top wage earners) was 5.33 times greater than wages of the top 0.1 percent of wage earners, a ratio 2.15 points higher than the 3.18 ratio that prevailed over the 1947–1979 period. This wage gain alone is equivalent to the wages of more than two very-high-wage earners.

As noted, the report which is worth reading, has data that can be used in the classroom and ample quantitative information for QL based classes.

About Thomas J. Pfaff

Thomas J. Pfaff is a Professor of Mathematics at Ithaca College. He created this website because he believes that sustainability, ranging from climate change to social justice, should be included in all courses whenever possible.

Check Also

How much land would the world need if everyone ate like the U.S.?

Our World in Data has the answer in their post, 50% of the world’s habitable …