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Study: CEO Pay Increased 127 Times Faster Than Worker Pay Over Last 30 Years

Compensation for chief executives at American companies grew 15 percent in 2011 after a 28 percent rise in 2010, part of a larger trend that has seen CEO pay skyrocket over the last three decades. Workers, on the other hand, have been left behind.

Since 1978, CEO pay at American firms has risen 725 percent, more than 127 times faster than worker pay over the same time period, according to new data from the Economic Policy Institute:

From 1978 to 2011, CEO compensation increased more than 725 percent, a rise substantially greater than stock market growth and the painfully slow 5.7 percent growth in worker compensation over the same period.

In 1978, CEOs took home 26.5 times more than the average worker. They now make roughly 206 times more than workers, EPI found. The pay isn’t always tied to the performance of their businesses — as ThinkProgress has noted, CEOs at companies like Bank of America often pocket huge pay increases even as the company’s stock price plummets and jobs are cut.

Workers’ wages aren’t tied to productivity either. Despite substantial gains in productivity since the 1970s, worker pay has remained flat. According to Labor Department data cited by the Huffington Post, inflation-adjusted wages fell 2 percent in 2011.

As a result, American income inequality has skyrocketed, growing worse than it is in countries like Pakistan and Ivory Coast. Wealth inequality is worse than it was even in Ancient Rome. And, as pay skyrockets and tax rates fall for the richest Americans, the rising inequality has left the bottom 95 percent of Americans saddled with more debt than ever before.

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