Thursday, May 10, 2012

Nice graph showing CEO-To-Worker Pay Ratio. Can you guess under which President it had the widest gap BY FAR? Better look before leaping.

Here is a graph charting CEO (Chief Executive Officer) pay and compensation relative to the wages paid to workers in the employ of those CEO's (for a summary of the methodology of this study go HERE to EPI). 

In 1965 the ratio is 20:1. The CEO was making 20 times the compensation (wages and benefits) that the average worker in his employ was making.  Read any point one the line in the same way. 

I was surprised to see that the ratio is now back to mid-1990 level!  It fell dramatically after 9/11 and the subsequent recession (or should say the one we were already headed into) and never recovered to its peak in the last year(s) of the Clinton administration Yes, the Clinton administration! 

Note: The source of this chart comes from the Liberal (Left-leaning) think tank Economic Policy Institute (EPI). PLEASE no rants of bias! :)
Source: EPI

Two possible explanations: (1) the rapid growth in CEO pay and leveling of wages in the US coincided with globalism---CEO's/Execs had world-wide operations responsibilities increase (hence more pay/compensation) and US workers rapidly had to "compete" (read that had jobs off-shored) with workers around the world (hence stagnating wages).  Or (2) the default--Corporate greed.  You choose.  I am not picky...
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