Daffodils. Baseball. Allergies. Reports on CEO pay. Ah, the rites of spring in America.
Over the weekend, The Wall Street Journal published it’s annual look at what the CEOs of the biggest U.S. companies earn, setting up some of the usual hand wringing over how much is too much when it comes to chief executive pay. For the record, they found median pay for the bosses of S&P 500 companies at $12.4 million last year, up 6.6% from 2017 and the highest since the 2008 recession.
On Friday, it was The New York Times chiming in with their overbroad and eye-roll inducing headline (“It’s Never Been Easier to Be a C.E.O., and the Pay Keeps Rising”)—a whopping generalization that conflates the earning of just the top 200 CEOs with the take-home of all US CEOs.
But look at data for all U.S. CEOs—as we do each year—and you get a different story. Chief Executive Research surveyed 1,631 private companies in April through June of 2018 about their 2017 fiscal year compensation levels and practices, as well as their current and expected compensation levels for senior executives for the remainder of 2018. (Detailed data from this survey is analyzed and presented in our annual CEO & Senior Executive Compensation Report for Private Companies.)
The median private company CEO total compensation package for 2017? $350,622. For the record, that’s just 6.7 times the median income for all U.S. workers, not 275 times, as some have said.
That’s worth noting, especially as we head into a 2020 election where CEOs and their pay are highly scrutinized, of the roughly 30 million businesses in the United States, fewer than 6,000 are publicly traded and only the largest 8 percent of these public companies make it into the S&P 500.
For those keeping score, that’s 0.002 percent of all U.S. companies.
Without a forward-looking lens, even a well-run process can produce the wrong outcome.
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