Highlights : compensation for chief executives of publicly traded companies in the S&P 500 last year leaped by more than 28 percent compared to 2009 .... while executives at major publicly-traded corporations were enjoying their 28 percent pay boost, the average rank-and-file American worker saw weekly pay increase by less than 1 percent, after accounting for rising prices, according to Labor Department data.
NEW YORK -- What a glorious day to be an American worker! Pay is skyrocketing, the Great Recession is hardly a memory and leaders in Washington are putting labor concerns at the front and center of their agendas -- provided you are a worker who happens to be at the top of the corporate organizational chart.
In the latest sign of the growing disconnect between reality as enjoyed by corporate chieftains and that experienced by pretty much everyone else, compensation for chief executives of publicly traded companies in the S&P 500 last year leaped by more than 28 percent compared to 2009, according to a new survey from Equilar, a research firm that tracks executive pay.
Among those enjoying perches at the top of the pyramid, according to a table on Equilar's site: John G. Stumpf, chairman and chief executive of Wells Fargo, the bank recently accused in a confidential federal audit of cheating taxpayers in its handling of foreclosed homes, pulled down $17.6 million; Lloyd Blankfein, overseer of Goldman Sachs, the banking giant that has become synonymous with malevolent Wall Street shenanigans, took home $14.1 million; and Jeffrey Immelt, chief of General Electric, netted $15 million in pay last year and is now tasked with helping President Obama create American jobs.
How is that going, by the way? Unemployment remains stuck at 9.1 percent, and even those people with jobs are predominantly consumed with a struggle to hang on, rendering upward mobility a fantastical aspiration in many homes. During 2010, while executives at major publicly-traded corporations were enjoying their 28 percent pay boost, the average rank-and-file American worker saw weekly pay increase by less than 1 percent, after accounting for rising prices, according to Labor Department data.
You may be tempted to shrug this off as more of the same, and you would have the facts on your side. The average weekly earnings for rank-and-file employees now sits at roughly the same place it did at the beginning of 1980, after adjusting for inflation. Several caveats go into absorbing this data: among them, the fact that millions of women and millions of immigrants entered the workforce, tending to pull wages down. Yet the compensation numbers merely add the official stamp to a painfully apparent trend: the breakdown of the basic American middle class opportunity. An awful lot of people have gotten up early, gone off to work, brought home as much as they could for their families and -- over the last three decades -- found themselves sliding backward.
The latest snapshot of the chief executive pay picture also underscores a more recent vintage truth that should be disturbing for anyone intent on trying to avoid another financial crisis: The number of short-term measures used to determine executive compensation actually increased slightly in 2010 compared to the year before.
Have we learned nothing from our near slide into the abyss? The financial crisis of 2008, which made an already weak job market punishingly bleak while putting taxpayers on the hook for speculative bets made by bankers, was about many things, but one of its biggest causes was a failure to get the incentives straight in our economy.