- While it’s not surprising that CEOs make a lot more money than their employees, the massive extent of that pay gap can sometimes be overlooked.
- US companies are required to publish their chief executives’ annual compensation, as well as the ratio of that compensation to the annual pay of the company’s median employee.
- Using those ratios, we calculated how long it took CEOs at 19 of the biggest companies in the US to make what at typical employee earned in a year.
- Several CEOs, including Disney CEO Bob Iger and Starbucks CEO Kevin Johnson, took less than a day to make a typical employee’s annual salary.
- Visit Business Insider’s homepage for more stories.
CEOs make a lot more than the workers they oversee. We took a look at just how big that gap is at some of America’s biggest corporations.
One of the provisions of the post-financial-crisis Dodd-Frank reform bill requires corporations to disclose the ratio of their CEO’s pay to that of the median employee at the company. Using those pay ratios, we calculated how long it would take the CEOs of big US companies to make what the median employee earned in a year.
So far, 19 of the 100 largest corporations in the S&P 500 as measured by their market capitalizations have filed their CEO compensation figures and pay ratios for the 2019 fiscal year. More companies will follow over the next several months.
The gap between what a CEO makes and what a typical employee makes varies widely from company to company. Nvidia CEO Jen-Hsun Huang had a total compensation 88 times larger than the typical employee at his company, meaning it took him a little over four days to earn the median employee’s annual salary. Meanwhile, Walmart CEO Doug McMillon made 1,076 times what the typical Walmart worker made, and thus earned a median Walmart employee’s annual salary in just eight hours.
As with any discussion of executive compensation, it’s worth noting that pay for people at the top is a bit more complicated than just getting a biweekly direct deposit. Many CEOs receive the bulk of their compensation in the form of equity in the companies they run, and so they may not realize the full value of their pay as reported to the SEC for years.
Here’s the full list, along with the CEOs’ fiscal year 2019 compensation, median employee pay, and the CEO to median worker pay ratio:
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