A study by the Economic Policy Institute says the chief executive officers of America’s largest firms were paid an average of $15.6 million each in 2016.
In a report published Thursday, authors Lawrence Mischel and Jessica Schieder say that amount is 271 times as much as a “typical” worker’s earnings at those same corporations.
That boss-to-worker pay ratio is slightly lower than it has been in the past few years, but is still “light years” higher than the 20-to-1 gap between workers and bosses in 1965, or the 59-to-1 difference that was measured in 1989.
CEOs’ pay has grown far faster than typical workers’ earnings in recent decades, and it also has increased at a much faster rate than stock-market valuations for those same companies.
Compensation figures include salary, the right to buy stock at certain prices, and bonuses, according to EPI, which is a nonpartisan think tank that focuses on the concerns of low- and middle-income workers.
The website Salary.com said CEOs are highly paid because their skills and responsibilities are “extreme,” and there is a limited number of people who can perform these functions.
At the other end of the economic spectrum, meanwhile, the lowest paid full-time U.S. workers get a minimum wage of just over $15,000 a year. While most workers earn more, and many states have a higher minimum wage, those on the bottom rung earn around 1/1,000 as much as top-level CEOs.
The U.S. national minimum wage of $7.25 per hour has not been increased in eight years. A group called Business for a Fair Minimum Wage contends inflation during that period has cut the value of those already-low wages by about 15 percent.
While many businesses argue that raising the minimum wage will result in fewer jobs at the lower end of the economic spectrum, Business for a Fair Minimum Wage said higher wages for the lowest-paid workers could stimulate demand and help the economy.