Amid Widening Income Gap, CEO Pay Skyrockets Reaching 200 Times Average Worker Salary

The median CEO pay increased by nearly 200 times the typical worker’s wages in the past year, as per data analyzed for The Associated Press by Equilar. The median CEO in the S&P 500 was paid $16.3 million or 196 times as much as the median employee, a significant jump from the 185 number in 2022. Due to several factors including the board’s leniency towards CEOs and the stock market booming, the pay of the top executives is expected to rise further this year, widening the gap.

Top 10 Highest-Paid CEOs in The World

In the Equilar survey, the CEO of Broadcom Inc. stood out to be the highest-paid CEO in 2023. However, as per other outlets, there were four more CEOs who could be earning more.

According to AFL CIO, the CEO of Blackstone Inc., Stephen Schwarzman could be the highest-paid CEO in the world with a compensation of $253,122,146, reported in 2022.

Schwarzman is closely followed by Alphabet Inc. CEO Sundar Pichai whose reported salary was $225,985,145 in 2022.

Next comes the CEO of Hertz Global Holdings, Inc., Stephen Schere whose reported salary was $182,136,137 in 2022.

Fourth is Peloton Interactive, Inc. CEO, Barry McCarthy with a reported salary of $168,073,420 in 2022.

Then comes Hock Tan, CEO of Broadcom Inc with a salary of  $162,000,000 in 2023, as per the Equilar survey.

Nikesh Arora, the CEO of Palo Alto Networks Inc. stands sixth in the list with a reported salary of $151,425,203 in 2023.

Then comes Michael Rapino, CEO of Live Nation Entertainment, Inc. with a compensation of $139,005,565 (2022).

The eighth spot is occupied by Douglas Ingram, CEO of Sarepta Therapeutics, Inc. with a salary of $124,938,694 (2022).

Then comes Pinterest, Inc. CEO Bill Ready with a salary of $122,651,735 (2022).

The last two sports were occupied by the CEO of CS Disco, Inc., Kiwi Camara with a salary of  $109,531,440 (2022), and Workday, Inc. CEO Aneel Bhusri with a salary of $102,685,309 in 2023.

One outlier to the list was Tesla CEO Elon Musk, who as per filings draws no salary. Last year, Musk’s 2018 pay package which was just shy of $50 billion was going to be reinstated before a judge in Delaware struck the proposal down.

Now, Tesla is seeking to change its state of incorporation from Delaware to Texas, and Musk’s estimated $56 billion pay package will be up for discussion again at the next shareholder meeting, as per Forbes.

The Widening Pay Gap Between CEOs and Employees

The pay packages for CEOs of S&P500 companies rose nearly 13% last year, as per the AP report. Roughly two dozen of the CEOs surveyed got a pay bump of 50% or more.

On the other hand, the median pay for normal workers rose by 5.2% in the last year. That’s just about above the rate of inflation. The median S&P 500 employee made about $81,467 in 2023, as per the report. This can be frustrating to employees who are already battling high costs.

One of the major reasons behind the widening gap is that CEO pay is closely tied to share prices. Despite high inflation, the stock market has gained significantly over time. The  S&P 500 has climbed 11% since the start of the year to all-time highs.

Thus, stock awards which make up about 70% of the total compensation of CEO gave a bump to their pay package. As per Equilar, the median stock award increased by 10.7% to $9.4 million, last year.