The typical CEO of a major U.S. corporation has to work fewer than seven hours to make the amount of money that the average worker earns in an entire year, according to a new analysis by Sarah Anderson of the Institute for Policy Studies.
Anderson, an expert on executive compensation, wrote Friday that "if the typical CEO of a large U.S. corporation clocks in at 9:00 am on January 2, by 3:37 pm that afternoon he'll have earned $58,260—the average annual salary for all U.S. occupations."
The growing chasm between typical worker pay and CEO compensation has soared by nearly 1,500% since 1978. Workers' wages, meanwhile, have lagged significantly over the past four decades, rising just 29% between 1979 to 2021.
Anderson based her analysis on the average pay of a CEO of an S&P 500 company, which was $18.3 million—or $8,798 an hour—in 2021, the most recent data available.
"I started by looking at the fast food workers who often toil straight through the holidays," Anderson wrote. "Most McDonald's restaurants are open even on Christmas Day. Average pay for this labor force is just $26,060 for the whole year. A typical CEO would bank that by noon on his first day back in the corner office suite."
"Then I thought of the home care aides who may be the only people around to cheer up their homebound elderly and disabled clients over the holidays," she continued. "They earned an average of just $29,260 in 2021. The typical CEO of a big U.S. corporation would pocket that much by lunchtime on his first workday of the year. He'd have to work less than an hour more to make $36,460, the average annual pay for a pre-K teacher."
A recent analysis by the Economic Policy Institute found that, on average, top CEOs in the U.S. were paid 399 times more than typical workers last year.
Separate research by the AFL-CIO showed that Amazon had the highest CEO-to-worker-pay ratio of all S&P 500 companies last year: 6,474 to 1.