Average CEO To Worker Pay Ratios for the Fortune 100

We hear a lot about ‘fat cat’ executives earning massive seemingly undeserved salaries which can amount to up 100 times the average salary of workers in the company. But, a lot of time its hearsay. So, what are the facts; how much do executives earn in comparison to their workers and how does the performance of these companies compare to those who pay their CEOs more modestly?

Current research suggests that US company CEOS are earning nearly 300 times as much as the average worker.

Payscale has also shed some light on this with their survey and infographic, titled CEO Pay In Perspective. They looked at CEOs in the Fortune 100 and identified which bosses have the highest and lowest pay ratios in relation to their workers. They also looked to see how these pay ratios correlated with job satisfaction, corporate revenues and how well employees are paid generally.

So, what did they find? You can find the full results presented in the infographic at the end of this article, but I have summarized the key points below – and also explained the implications for workers and business policy makers, respectively.

Key points

The companies with the top five highest pay ratios, ranging from 1034:1 to 434: 1, had average job satisfaction levels of 62.4%. 2 out 5 of them paid below market rate and 2 paid on market rate with only one paying above market rate.
The companies with the top five lowest pay ratios, ranging from 18:1 to 9: 1, had average job satisfaction levels of 74.8%. 4 out 5 of them paid above market rate and 1 paid on market rate.

The message for job seekers is that when choosing your employer, where possible, try and establish the company’s CEO to worker pay ratio as this may indicate an environment that pays better versus the market and where you are likely to more satisfied.

The message for bosses and CEOs is that it is vital to consider your CEO to worker pay ratio as a high CEO to worker pay ratio seems to correlate with lower pay for your staff and lower job satisfaction all of which could lead to reduced performance and reduced shareholder value.

CEO Pay in Perspective