Is the World Upside Down?
No, my name is not Chicken Little. The world is not upside down, but there are some salaries made by CEO's that would make one think the world is not right. Once again I have just read a report of a CEO from a major medical company getting a big raise this year. (something like a 26% raise on a 2.2 million salary, which would be around $572,000) Why was this person getting a big raise? The report stated that company profits were up because the company raised productivity standards, and the employees were able to meet the new demands.
The key wording in this report is that "the employees" were meeting the new standards. They were working harder to make a bigger profit for the company. However, nowhere in this report did it mention that the employees were receiving any kind of raise or bonus. Just the one person sitting at the top of the ladder is going to profit. Of course, I'm sure the stockholders of this company will also see an increase on the value of their shareholdings. The employees? Well, they get to keep their job.
Again, I have to say I'm sick of hearing how much many CEO's make. Anyone could sit in a big office and demand better productivity out of their workers, show an increase in yearly profit, and then have the nerve to say it was all their doing. Back in 1980, the average CEO was making 40 times what the average worker in the company was earning. Today, a typical CEO makes 500 times what the average worker of the company makes! 500 times! That means that a CEO can make more in one year than the average employee, their children, their grandchildren and their great grandchildren will make in their entire lifetime.
Figuring our U.S. rate of inflation, which since 2000 has risen a whopping 26.08%, even the average employee is almost losing ground. The average workers raise during the same years has only increased 27.01%. A CEO's increase during the same years skyrocketed 535%. In real money terms, if you were employed in 1980 making an average hourly wage of $15.87 per hour and your wage had been adjusted at the same rate as a CEO, today you would be earning more than $200,000. Do you think you could live on that?
If you're interested in what CEO's of top companies earn, follow this link to the AFL-CIO's Executive Paywatch Database.
Until next time, hope all your thoughts are good-
Tim