CEO Pay Has Grown By 1,460 Percent Since 1978, as Workers’ Wages Stagnate

While workers’ wages have stagnated in comparison to productivity over the past four decades, CEO pay in the U.S. has skyrocketed at a rate far outpacing the growth of the economy and productivity, a new report by the Economic Policy Institute (EPI) finds.

According to research released by EPI on TuesdaySince 1978, the CEO pay has risen by an astounding 1,460%. This has far outpaced the growth of the economy and even the pay of the top 0.1 percent, EPI finds, with the S&P stock market growing by 1,063 percent in the same time and the earnings of the top 0.1 percent growing 385 percent between 1978 and 2020.

However, worker pay has been increasing. remained relativelyEPI finds that the average worker’s pay has remained relatively constant since 1978, but it has increased by just 18.1 percent in the past 43 years. The gap between average worker pay and CEO pay has increased significantly. According to the report, CEOs of the top 350 U.S. businesses earned an average of $27.8 million per year, while workers at those same firms earned $70,000. This is a ratio of about 400 to 1 in 2021 — itself a major multiplication of 1965’s ratio of 20 to 1 and 1978’s ratio of about 30 to 1.

The pandemic was a catalyst for the growth of CEO pay. Millions of people were laid off, furloughed, and frontline workers were also affected. They risked their livesTo keep basic services running between 2021 and 2019, CEO salaries jumped by 30.3 per cent. For workers still employed, wages grew by only 3.9%.

EPI’s data doesn’t even include the pay of CEO Elon Musk, who has been one of the pandemic’s The biggest winners. Researchers excluded Musk, Tesla, and other large companies from their analysis. His realized salary, which includes stock sales, would have nearly 1,000 times the average CEO in a large company. This would have boosted average CEO pay increases between 2020-2021 by over 300%.

The trend of growing wage inequality doesn’t appear to be stopping any time soon. The gap between CEO and worker salaries has been increasing since the late 1970s when the U.S. entered the euro. a cruel neoliberalismPresident Ronald Reagan, who was responsible for imposing these rules. for growing economic inequalityEver since.

In fact, Jerome Powell, conservative Federal Reserve Chair, has stepped down in the face the current economic crisis, which has resulted in lower wages for workers. is making moves to “get wages down” — while saying nothing of skyrocketing CEO pay.

High CEO pay ratios aren’t a simple symbolic issue, the report says, but rather an issue that affects workers and the economy. The largest driver of the increasing gap between the top 0.1% and top 1% and the rest is income growth by executives. Further concentratesThe power of the U.S.’s most powerful people

As EPI notes, it doesn’t have to be this way. “Exorbitant CEO pay is a contributor to rising inequality that we could restrain without doing any damage to the wider economy,” EPI economists Josh Bivens and Jori Kandra write. “CEOs are getting ever-higher pay over time because of their power to set pay and because so much of their pay (more than 80 percent) is stock-related. They are not getting higher pay because they are becoming more productive or more skilled than other workers, or because of a shortage of excellent CEO candidates.”

EPI recommends Congress adopt policies to rein in CEO wealth. This includes raising the corporate tax rate and marginal tax rates for corporations with high CEO pay ratios.

These proposals are met with fierce opposition by wealthy lobbyists Conservatives and liberalsHowever, Congress appears to be allowing workers to take matters of stagnant wages, poor working conditions, and other issues into their own hands. The labor movement has been ResurgenceWorkers are protesting against the greedy displays of corporations in recent years, in response to runaway capitalism and the pandemic.