It takes 300 worker salaries to equal the average CEO's pay, data show
The pay gap between CEOs and the typical U.S. worker widened during the pandemic. Leaders of companies listed on the S&P 500-stock index earned an average of $15.5 million in 2020, a raise of more than $700,000 from the previous year, according to the AFL-CIO.
That means S&P 500 chief executives made 299 times what rank-and-file employees earned, up from a ratio of 264-to-1 in 2019, the labor union said in a report released on Wednesday.
The biggest divide was among consumer discretionary companies, such as apparel, fast-food and other large retailers. The average consumer discretionary company in the S&P 500 Index had a pay ratio of 741-to-1 in 2020, according to AFL-CEO data. New Amazon CEO Andy Jassy received $35.8 million in total compensation in 2020, for example — 1,234 times that of the median worker at the online retailer, who made $29,007 last year, the union said in a statement.
Amazon did not immediately respond to a request for comment.
The pay gap was smallest among utilities, where the ratio was 97-to-1, a scenario that AFL-CIO Secretary-Treasurer Liz Shuler attributed to the sector's heavy concentration of organized workers. "It's no coincidence that, according to the Bureau of Labor statistics, 20% of utility workers are members of unions," Shuler stated.
While Shuler and the AFL-CIO decried the heavy compensation given to many CEOs amid a pandemic that had many average workers losing their jobs, at least one company had a different take.
Yum Brands' profits slid during the pandemic, but the fast-food giant still gave its CEO a multimillion-dollar bonus, with its board of directors finding it "unfair" to penalize him due to COVID-19's adverse impact on the company's bottom line.
The AFL-CIO findings echo those of a study by the Institute for Policy Studies, which found half of the 100 largest U.S. employers of low-wage workers adjusted their CEO pay packages last year, sweetening rewards for chief executives during the pandemic while cutting pay for average workers.
The median pay package for a CEO at an S&P 500 company hit $12.7 million in 2020, according to data analyzed by Equilar for the Associated Press.
