AFL-CIO's Executive Paywatch report, released today, shows that the imbalance between the pay of corporate CEOs and working people persists as a problem. In particular, the report shines light on the 20 companies with pay ratio disparities higher than 1,000-to-1 that furloughed workers in 2020.
AFL-CIO Secretary-Treasurer Liz Shuler (IBEW) expanded on this new feature of the report:
With the COVID-19 shutdowns earlier this year, we saw many CEOs take salary cuts as a token of their solidarity with furloughed workers. While these CEO salary cuts made for good headlines, they are mostly window dressing. Base salary makes up less than 8% of total compensation for CEOs of S&P 500 companies. Most CEO pay is in equity awards. The real story in executive compensation was that companies ramped up their equity awards to senior executives at the beginning of this year. Meanwhile, millions of working people have been furloughed or laid off due to COVID-19 related shutdowns. This disparity represents a fundamental imbalance in our economy. Working people are being treated as disposable employees. Now these cast-off workers, as a result of COVID-19, are at risk of having their unemployment benefits cut.
The Executive Paywatch website is the most comprehensive, searchable online database tracking CEO pay. Key highlights of this year's report:
- In 2019, CEOs of S&P 500 companies received, on average, $14.8 million in total compensation.
- The average S&P 500 company CEO-to-worker pay ratio was 264-to-1.
- S&P 500 CEO pay has increased, on average, $3.4 million over the past 10 years. Meanwhile during the same period of time, the average U.S. production and nonsupervisory worker’s pay increased just $8,360. From 2018 to 2019, the average production and nonsupervisory worker received barely more than a $1,500 raise, bringing their total pay to $41,442.
- Abercrombie & Fitch had the highest disclosed ratio of CEO-to-worker pay of any public company: 4,293-to-1. Abercrombie’s CEO received $8.4 million in total compensation compared to the company’s median worker who received less than $2,000 in compensation.
The data presented is particularly striking given that the COVID-19 pandemic has resulted in the highest unemployment levels since the Great Depression. Nearly 15% of workers were unemployed in April of this year compared to a high of 10% unemployment after the 2008 Wall Street financial crisis.
The report highlights the importance of passing the HEROES Act to address the negative effects of the pandemic on working people. Shuler said: “We are demanding that the Senate pass the HEROES Act and provide the relief that working families need. The HEROES Act will extend unemployment insurance while keeping companies that paid more than $1 million in executive pay from getting refunds of previously paid corporate income taxes.”
Visit the Executive Paywatch website and read the full report.