Top CEOs Made Nearly 300 Times More Than Average Employee During Pandemic

Economic justice advocates on Wednesday amplified calls for a wealth tax and far-reaching pro-worker legislation amid the release of two reports detailing how income and wealth inequality between corporate CEOs and their employees has skyrocketed during the coronavirus pandemic.

The AFL-CIO's Executive Paywatch report examined compensation at S&P 500 companies, revealing that executives were paid 299 times the average worker's salary in 2020.

"The only reason we're reaching the other side of the Covid-19 pandemic is because working people stepped up. What every worker deserves is family-sustaining wages a free and clear path to stand together with our co-workers in unions."
--LIz Shuler, AFL-CIO

On average, CEOs received $15.5 million in total compensation last year while the average worker in a non-supervisory role earned $43,512.

CEO-to-worker pay ratios increased from 264-to-1 in 2019, while workers' pay last year marked an increase of only $957 over the past decade.

"Inequality, the imbalance in our economy, is clear by this report that the pay of CEOs and working people continues to be a major problem in this country," said Liz Shuler, secretary-treasurer of the AFL-CIO.

According to the report, Chad Richison of the online payroll company Paycom was the highest-paid CEO last year, receiving $200 million in salary and stocks. Kevin Clark, CEO of auto parts company Aptiv, took home compensation that represented the greatest gap between an executive and workers; Clark was paid $31 million last year while the average worker at his company made only $5,906, amounting to a 5,294-to-1 pay ratio.

Other companies topping the list of highly-paid CEOs and high pay ratios included General Electric, Nike, Hilton, and Chipotle.

"The only reason we're reaching the other side of the Covid-19 pandemic is because working people stepped up," Shuler said. "Our first responders, county and municipal workers, food and retail--think about the sacrifices--transportation workers, construction, manufacturing, communication workers... We hear so many business leaders calling those workers 'essential' and 'heroes.' But words are not enough."

"What every worker deserves is family-sustaining wages a free and clear path to stand together with our co-workers in unions," she added.

The AFL-CIO reiterated its support for the PRO Act and called on lawmakers to pass the legislation, which would expand workers' eligibility for collective bargaining, limit the power of management to sabotage organizing efforts, and take other steps to strengthen labor unions.

"These numbers illustrate why passing the PRO Act is so urgent," Shuler said of the findings in this year's Executive Paywatch. "Passing the PRO Act is the single best way to reverse economic inequality and raise wages for all working people. It's how we balance the scales before they break. That's why we are asking all those who are concerned about runaway CEO pay to contact their senator and urge passage of the PRO Act."

The AFL-CIO's report was released as Americans for Tax Fairness (AFT) and the Institute for Policy Studies (IPS) unveiled an analysis of Forbes wealth data which showed the collective wealth of the United States' 713 billionaires grew by $1.76 trillion, or nearly 60%, since the pandemic began in March 2020.

"That leap in fortune among a tiny group of Americans is nearly enough to fund the entire $1.8 trillion ten-year cost of [President Joe Biden]'s American Families Plan, which would make critical investments in education, childcare, healthcare, nutrition and more for tens of millions of Americans," said the groups. "But very little if any of that ballooning billionaire wealth will ever be put to such public use. That's because even though such asset growth is the primary source of income for the rich, under current rules almost none of that income will ever be taxed."

AFT and IPS called on Congress to pass reforms which would raise the corporate tax rate to 28%, end corporate offshore tax dodging, and close loopholes that allow for a low tax rate on capital gains. Each of the suggested reforms would raise between $324 billion and over $1 trillion in revenue.

"There's not a better symbol of the need for the Biden reforms than tax-free billionaires," said Frank Clemente, ATF's executive director. "We can raise some $4 trillion for vital public services simply by ensuring the rich and corporations begin paying their fair share of taxes. In the budget soon to be voted on, Congress needs to reward work, not wealth, ignore the pleadings of special interests, and do what voters are demanding."