CEO’s Who Lay Off Workers Get Paid More
September 1, 2010
Welcome to the new corporate America. Workers get the squeeze, while CEO’s take what they please. Chief Executive Officers who cut the most jobs during the recession earned significantly more than their peers, according to a study just released by the Institute for Policy Studies. The report highlights the great unfairness of the Great Recession. Click here to learn more.
The companies that laid off the most workers are actually making more money than their well-paid peers at other big U.S. Companies. The Institute for Policy Studies looked at the 50 companies that cut the most jobs and found on average their CEO’s made $12 million a year. Sure is nice to know at least our corporate executives aren’t feeling the pain of the Great Recession.
American workers, by contrast, are taking home less in real weekly wages than they took home in the 1970s. Back in those years, precious few top executives made over 30 times what their workers made. In 2009, IPS calculates CEOs of major U.S. corporations averaged 263 times the average compensation of American workers.
Combined, the CEOs at those 50 firms made $598 million and laid off 531,363 workers — accounting for more than three quarters of the 697,448 announced layoffs at the top 500 firms. The study also found that 72% of the companies announced their mass layoffs during periods of positive earnings reports, and that they companies enjoyed a 44% profit increase in 2009.
The study’s lead author Sarah Anderson says it’s time to reign in this out of control executive pay system which was a key contributor to the economic crisis. Anderson says reforms now being considered by Congress are badly needed. They include proposals to give shareholders more authority over CEO pay and to require more transparency. Click on the video above to hear more.
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