CEO pay rises 15 percent as workers’ pay falls to 1996 rates
In 2012 American CEOs saw their pay spike 15 percent after a 28 percent pay rise in 2011 all while workers saw their inflation-adjusted wages fall 2 percent
This is in line with a trend that dates back three decades.
- In 2011, the U.S. Census Bureau reported that the income of the typical American family had dropped for the third year in a row.
- The median family income in 2010 was $49,445 which is 7.1% below its 1999 peak
- When adjusted for inflation, the median family income is the rate it was in 1996
- CEO pay spiked 726.7 percent between 1978 and 2011, while worker pay rose just 5.7 percent
- CEOs scored an 8% pay increase in 2012, taking the median to $9.7 million-the biggest increase in two years.
GMI’s 2012 CEO pay report found:
- 2012 was the second consecutive year of double-digit total realized compensation increases at the median and average for the Russell 3000.
- Average 2011 total realized compensation in the S&P 500 is $12.1 million.
- The ten highest paid CEOs earned about 78 percent of realized compensation through option exercises and vested equity
- Three of the ten highest paid CEOs thus far in 2012 are from the software industry
The rise in CEO pay in 2012 serves as a remarkable contrast with the rest of the economy, while still trying to recover, remains weak enough that the Federal Reserve needs to recommit to its stimulative efforts to keep the unemployment rate from rising from 7.6%.