The pay gap between company bigwigs and ordinary working stiffs is narrowing, but there's still a major chasm.
CEOs at the largest U.S. firms now make 271 times more than the average worker, according to calculations by the Economic Policy Institute for 2016 salary numbers. Including stock options, average pay for those at the top of the corporate ladder came to $15.6 million in the group that the EPI examined.
While the ratio is still large, it's actually on the downswing — the gap peaked at 376-to-1 in 2000 and was 286-to-1 in 2015. However, it's still "light years" from the 20-to-1 ratio in 1965 and even the 59-to-1 ratio as recently as 1989, said EPI researchers Lawrence Mishel and Jessica Schieder.
The highest-paid executive for 2016 was Marc Lore, CEO of e-commerce at Wal-Mart, who made $243.9 million, according to S&P CapitaIQ. The CEO of Alphabet's Googe, Sundar Pichai, brought in $199.7 million, while Robert J. Coury, chairman of Mylan, made $136.8 million. They were followed by Thomas Rutledge, the Charter Communications CEO, at $98.5 million, and CBS CEO Les Moonves, at $69.5 million.
"Regardless of how it's measured, CEO pay continues to be very, very high and has grown far faster in recent decades than typical worker pay," Mishel and Schieder wrote. "Exorbitant CEO pay means that the fruits of economic growth are not going to ordinary workers, since the higher CEO pay does not reflect correspondingly higher output."
The authors point out that CEO pay has grown far more quickly than corporate profits.
"This means that CEOs are getting more because of their power to set pay, not because they are more productive or have special talent or have more education," they said. "If CEOs earned less or were taxed more, there would be no adverse impact on output or employment."