Researchers Lawrence Mishel and Alyssa Davis at the Economic Policy Institute released some pretty amazing new numbers today on the growth in American CEO pay over the last few decades:
“Over the last several decades, inflation-adjusted CEO compensation increased from $1.5 million in 1978 to $16.3 million in 2014, or 997 percent, a rise almost double stock market growth. Over the same time period, a typical worker’s wages grew very little: the annual compensation, adjusted for inflation, of the average private-sector production and nonsupervisory worker (comprising 82 percent of total payroll employment) rose from $48,000 in 1978 to just $53,200 in 2014, an increase of only 10.9 percent. Due to this unequal growth, average top CEOs now make over 300 times what typical workers earn.
Although corporations are posting record-high profits and the stock market is booming, the wages of most workers remain stagnant, indicating they are not participating equally in prosperity. Meanwhile, CEO compensation continues to rise even faster than the stock market.
In order to curtail the growth of CEO pay, we need to implement higher marginal income tax rates and promote rules such as “say on pay.” At the same time, we need to implement an agenda that promotes broad-based wage growth so typical workers can share more widely in our economic growth.”
Ah…the genius of the free market.
Click here to see their data in the form of some powerful graphics.