A reader posted the following as a comment. I have no idea where the data come from and I assume his point is something to do with income inequality.
Country Year 2000 CEO compensation as a multiple of average employee compensation*
South Africa 51
Hong Kong 38
China (Shanghai) 21
New Zealand 16
South Korea 11
Who cares? 😛
But let’s explore a little. For example, according to the Bureau of Labor Statistics, in 2012 the average salary for all American CEOs was $176,550. It’s only when you get into the Fortune 500 companies that you see the eye-popping numbers. That’s 500 people out of three hundred plus million Americans. And by the way, not even the AFL-CIO claims a multiple of 531 as shown below.
Chief executives of the nation’s largest companies earned an average of $12.3 million in total pay last year — 354 times more than a typical American worker, according to the AFL-CIO. The average worker made $34,645 last year, according to the group that represents over 50 trade unions.
But even this is misleading because one number is total compensation and the average worker is cash compensation which does not include the value of non-cash compensation.
If you define inequality as not everyone making the same, then we have inequality … and thank goodness for it. Several years ago I was having coffee at a cafe in Italy with a fellow, but disgruntled, traveler. This fellow operated a small business and had for many years. Somehow we got on politics and pay and who knows what other taboo subjects. In any event he quickly made his position clear … “everyone should earn the same amount,” he declared. “Everyone?” I tried to clarify. “Yeah!” he said as he sat there during a two-week tour of Italy. I couldn’t let this one go so I asked if he knew what he would make if he and every other American earned the average? When I told him the amount, he gave a subdued “Humph” and changed the subject. Some ideas sound good until you see how they apply to you.
All this ranting about inequality and yet barely 2/10th of one percent of tax returns are for incomes over $1 million. Are some CEOs overpaid, they sure are. So are some clerks, loading dock workers and even teachers. Do I care if a CEO is overpaid, not one bit unless I am a shareholder and the stock is not performing or there are poor dividends paid. And you shouldn’t care either.
In my opinion what you should care about is anything beyond your control, repeat beyond your control, that intentionally prevents you from getting a fair shot at improving your life and your income.