CEOs earned an average of nearly $17 million in 2022, which is 272 times more than their workers.

CEOs earned an average of nearly $17 million in 2022, which is 272 times more than their workers.

The widening gap: CEOs make 272 times more than their workers

It’s no secret that the pay gap between CEOs and workers has been growing over the years. And now, a new report from the AFL-CIO sheds light on just how much that gap has widened.

According to the report, CEOs at 500 major firms make a staggering 272 times more than their workers. This eye-opening statistic is based on the latest executive pay data from the S&P 500 companies.

In 2022, the average CEO’s paycheck reached a staggering $16.7 million, an increase of $5 million over the past decade. This significant surge in CEO compensation has fueled a wave of strikes and labor actions as workers demand higher pay and better working conditions.

“We really think that it’s important that when companies tell us they can’t afford it or that it doesn’t work for their business model, that we need to look at what they’re doing with executive compensation,” said Duncan Crabtree-Ireland, the national executive director and chief negotiator for actors’ union SAG-AFTRA.

The vast difference in pay means that, on average, CEOs make 272 times more than their employees. In other words, it would take an average worker five working lifetimes to earn as much as their top bosses. This stark inequality has sparked outrage and calls for change.

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While there was a slight dip in CEO compensation from 2021 to 2022, with a 9% decline, Brandon Rees, the AFL-CIO’s deputy director of corporations and capital markets, pointed out that this decrease was primarily due to a reduction in stock option compensation. Despite this decline, CEO pay remains exorbitant by historical standards.

The report also highlighted the industries with the largest pay gaps. Communication services topped the list, with CEOs making an astonishing 508 times more than their workers. On average, CEOs in this field earn nearly $38 million.

Amidst all of this, workers’ wage gains have been cooling off in the face of a less-than-ideal labor market. While prices have remained high due to ongoing inflationary pressures, wage growth has only recently started to outpace rising prices. In May, real wages saw a 0.2% increase for the first time in two years. However, the minimum wage in the US still lingers at just $7.25 per hour.

It’s worth noting that the wealthiest Americans continue to hold a greater share of the nation’s wealth than ever before. Despite initial predictions of a “richcession,” where the rich would see a significant decline in wealth, the reality has proven to be quite the opposite.

The widening CEO-worker pay gap is a pressing issue that calls for attention and action. As workers across various sectors take a stand for fair compensation, the spotlight is on companies to reassess their executive compensation practices. Achieving a more equitable distribution of wealth is not only morally imperative but also vital for a more just and stable economy.

• CEO pay
• Economy
• wealth gap