Labor group: Pay gap between CEOs, average workers has widened -- again
The average pay of a S&P 500 company CEO rose 6 percent last year to $13.9 million, or 361 times more than the average worker made, according to the AFL-CIO.
The labor group said the ratio between CEO and worker pay was 42-to-1 in 1980, 107-to-1 in 1990, and 347-to-1 last year.
“It’s no surprise that it has gone up again this year,” AFL-CIO secretary-treasurer Liz Shuler said on a conference call with reporters Tuesday.
“CEOs are experiencing pretty much an historic windfall these days,” she added.
The labor group has been comparing CEO pay with U.S. Labor Department data for the pay of the average production and non-supervisory worker for more than 20 years. The average pay for the rank-and-file worker was $38,613 last year.
This year, for the first time, public companies are required to compare their CEO’s pay with that of the company’s median worker — the employee who makes more than half of workers and less than the other half.
Congress mandated the disclosure in the wake of the 2008 financial crisis. But the U.S. Securities and Exchange Commission didn’t finalize rules for making the calculation until last year.
Mattel had the highest CEO to median worker pay ratio of the S&P 500 companies that the AFL-CIO analyzed, 4,987-to-1. The toy maker’s median employee — a worker in a Malaysian plant — made $6,271 compared to CEO Margaret Georgiadis’ pay of $31.3 million, the labor group said.
Two Pittsburgh companies had the highest ratios among the Pennsylvania companies that the AFL-CIO examined. The CEO pay ratio was 1,064-to-1 at South Side-based retailer American Eagle Outfitters and 1,015-to-1 at Findlay-based retailer Dick’s Sporting Goods.
Retailers have some of the higher CEO pay ratios because of their reliance on part-time and contingent workers, said Brandon Rees, deputy director of the AFL-CIO’s office of investment.
Mr. Rees said the SEC rules give companies some flexibility in calculating the ratio.
Mondelez International, the troubled maker of Oreos and Ritz Crackers, had two CEOs last year and based its ratio on the $17.3 million that former CEO Irene Rosenfeld was paid in 2017. That was 403 times more than what the company’s median worker made, he said.
Her replacement, Dirk Van de Put, was paid $42.4 million last year, which would have raised the ratio to 989-to-1, Mr. Rees said.
Ms. Shuler said the labor group plans to use the data quantifying the growing gap in income inequality is upcoming Congressional contests.
“This will be part of our economic narrative going into the election,” she vowed.
Len Boselovic: firstname.lastname@example.org or 412-263-1941.