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These 11 CEOs Are The Most Overpaid Relative To Their Employees
Earlier this month, we learned that the average employee at 10 legendary "Unicorn startups" is valued at somewhere around $8 million. These startups include Uber, Airbnb, Snapchat, Palantir, SpaceX, Pinterest, Dropbox, Wework, Theranos, and Square.
These "businesses" are valued at a combined $165 billion courtesy of the largely arbitrary and completely ridiculous methodologies employed by founders and their enthusiastic VC backers. Nevermind the fact that between them, they generate but $4 billion in revenue.
Meanwhile, employees at real businesses are worth far less. Take McDonald’s for instance (which, even in its diminished state, still brings in more revenue in three months than all of the Unicorns listed above pull in over the course of a year - combined) where the enterprise value per employee is a paltry (by comparison) $200,000.
But while the value per employee may vary widely across corporate America and Silicon Valley, one thing is constant - a vast disparity between the average worker and the C-suite.
As we noted at the end of June, CEOs in the US are back to making an average of 300 times what their employees make and although that’s short of the all-time high set near the peak of the dot-com bubble, we aren't far from the top.
Now, Bloomberg is out with a new study based on their own calculations and while it seems that their computation methods are predisposed to understating the case compared to the Economic Policy Institute's figures (shown above), the data still suggests that for at least three American CEOs, the gap between their compensation and that of their employees is even wider than the 303:1 ratio from the preceding chart.
Here's Bloomberg's list:
More color:
McDonald’s might have some explaining to do.
The fast-food chain has one of the highest ratios of CEO pay to that of the company’s average worker, at 644 to 1, according to data compiled by Bloomberg. Under a requirement approved last week by the U.S. Securities and Exchange Commission, public companies such as McDonald’s will have to disclose a similar metric annually, handing new ammunition to critics of C-suite pay packages.
McDonald’s former chief executive officer isn’t even close to topping the list of highest-earning U.S. execs last year, but that doesn’t matter. The figure the SEC is requiring measures CEO pay against the median compensation of all employees, an unfavorable ratio when your workforce includes a lot of burger flippers and fry cooks.
Some companies where top managers earned millions more last year than the $7.3 million paid to McDonald’s Don Thompson (who stepped down in March) actually have lower ratios. Examples include JPMorgan Chase and hospital operator Community Health Systems, both of which have pay gaps exceeding 200 to 1, which are still among the widest of all U.S. companies.
To be sure, estimates relying on data that are currently available will probably differ from what companies report when the SEC rule kicks in two years from now. For instance, the SEC is allowing companies to omit a limited percentage of workers overseas, where wages might be lower.
Bloomberg estimated average worker pay by identifying businesses’ reported salaries and benefits expenses, and dividing that by the total number of workers.
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How many of them are Satanists?
My blade is dry.
WWJD?
McDonald's?...I guess running a chemical company deserves a huge salary, especially as it is tanking.
How many are shekel pinchers?
No worries though, after this next Shemitah they'll be back to only making 200x the average employee.
who cares at this point? #jaded
Well, they earned it, after all. I mean...right? Right? If not, then my worldview is shattered.
Just wait until all workers are replaced with robots.
Then just wait a wee bit longer than that for the robots to replace all workers with humans.
Edit: I had nothing to do with the exploitation of 'bots on "BattleBots".
Edit-edit: I, for one, look forward to serving my Robot Masters.
my dream come true would be to play escaped convict and wardens wife with jamie's wife.
so if you took Donald Thompson's salary, cut it by $6 million and dispersed it among the employees of McDonalds, they'd be making what, $12k a year then? CEO envy is for loser socialists that want to work 4 hrs a day.
CEO envy is for loser socialists that want to work 4 hrs a day.
You leave Obama out of this, you dirty SOB!
It's not "CEO Envy" dumbass; it's how that compensation is even possible that's the problem.
>Kendall Jackson Winery in California.
>Owners are Billionaires.
>Workforce is mostly part time and illegal - NO BENEFITS!
>The TAXPAYERS OF CALIFORNIA AND THE REST OF THE USA pick up the cost of K&J's "part-time / illegal" workforce...SNAP, SECTION 8, MEDICAID, ECT!
>Shifting "employee costs" onto the backs of taxpayers ramps up profits...the CEO, and the rest of the ABC's, walk with the profits while YOU AND I get the bill for thier "Part-time / illegal" employees!
>Put and END to this cost shifting and the CEO pay/bonus drops dramatically...many businesses would fail too..we need a good washout...long over-due!
Imagine a business where the biggest "cost" is water instead of employees...say a Laundromat...and I MADE YOU pick up my water bill by "lobbying" the government to write the laws in my favor...my "profits" would be off the charts and I'd have a fat paycheck too!
The numbers are relatively meaningless at this point, but there is always the temptation to point at the obvious targets. It's easier to blame the monster rather than its creator and to truly fix the problem would require starting with all the disastrous laws, starting with the creation of the FED. We've built our own funeral pyre one piece of kindling at a time and it's almost time to light the fire and watch the world burn again.....
The "average" worker at chase bank makes $124k per/year!!!!
Chase bank? You make it seem like the bank tellers are making money. Most people working for JP Morgan don't make much.. 180k+ employees globally. Anyone working as an investment banker or trader bring the average wage up dramatically.. I'm sure 80% of employees make less than 100k
Less than 100k + live in NYC = Forked.
Especially after 45-50% taxes and then by the time you pay your rent you're basically looking at 15k to spend on all other expenses.
Might as well live in Arkansas and earn "only" 35k/year. You'd come out roughly even, not factoring in other-than-monetary concerns such as stress/health/sanity/peace-of-mind/etc.
So you must be one of the smart ones living in Arkansas. I live in South Texas but It wouldn't take much to get me to move to Arkansas. That state improved a lot when the Clintons left.
Regarding Arkansas (and I'm a native Arkie), it's getting more expensive in Northwest (Fayettenam, Chickendale, Bentonville) and the biggest landlords, the Lindseys are micromanager freaks who truly don't care about tenant safety, especially their Little Rock properties as of 2008. Keep in mind, Arkansas is the easiest state to get a bad renter kicked out. A nice hot patch of real estate awaits them after Judgement Day.
With that said, 35k/yr would let you live like a King in certain areas of the southern Ozarks, and with no african-americans at all in certain counties, busing is not an issue. Now to get weed legalized, and Heaven returns to Earth with the Arkansas State Po-leece finding better things to spend their time on.
You could morph it a little. Po-leese could be Po-fleece.
http://www.bloomberg.com/bw/articles/2013-12-04/a-third-of-bank-tellers-...
So we need to penalize CEO's of companies that provide tons of jobs for the stupid, unskilled, and basically unhirable?
They should be given a raise for putting up with the idiot employees.
Exactly. What ever happened to "thou shall not covet thy neighbor's goods." (Ten Commandments for those of you less educated)
Since the CEO is just another employee I wonder if "thou shalt not steal" is more appropiate here?
Take a look at McDonald's, how many stores need to work all year long just to provide the profit to pay their CEO's salary, how is that good share holder value? The CEO is supposed to be providing best value to the shareholders, yet he's earning such ridiculous amounts of cash that it has a significant effect on the profitability.
Its not my problem, but I do wonder who the share holders are, and how they put up with such an obvious con, the only conclusion I can reach here is that they are in the same scam.
Won't matter, for every rule there is a loophole and they control the rule makers....
Frickin Roger Goodell made $44 million dollars last year for doing what I'm not sure. The minimum for an NFL player is $440,000 (not guaranteed)
Shit Ted Wells got paid $5 million to write a report about the inflation of footballs. That is so insane its comical.
And Mrs. Brady's Net Worth is in the hundreds of millions by now -- for deflating Tom's balls daily.
Who needs college or an MBA, when you've been gifted with a great lifetime ride (Top Tier genes and horny rich guys to pick from).
Damn it Tyler! Don't be stoking class warfare rhetoric. The middle class has been winning for 3 decades and I don't want you jinxing it!
I'm surprised how little the McDonalds guy is paid. That's one of the biggest companies in the world.
You would be even more surprised to learn what is in the chemical slurry they serve.
I look at McDonald's at the head of the list and think if they paid more they'd be able to get higher quality workers and be able to fire all those that are not worth what they're being paid now. Those that got fired could be out in the streets with signs that say "Make me worth hiring."
In ten years or less, fast food restaurants are just going to be drive-up vending machines.
So the McDonalds wage is $11K and change. Over a 2,000 hour year that is $5.50 per hour. US federal minimum wage is $7.25. The cinema company...similar annual pay.
Some of these employees aren't working a full time McDonalds Job?
Some of these employees aren't working in the US?
If $11K is the average there must be some lower numbers out there?
This article is misleading at best.
Very few fast food workers are full time. 10 to 20 hours a week is typical. That's all they can get. Employees are usually only needed at mealtime and then they are off the clock.
let's face it, those maggots are just that much better than everyone else. really they are the only mother fuckers in the company (or the country) that are worth a damn. the billionaires did it all by themselves and we're just fucking god damn lucky they let us tag along for the ride.
I know I feel Terrible!
Arrrgh...
"Hey, let's Fuck the emplyees!"
Hey, let's fuck the stockholders and bondholders!
If they are stupid enough to look on the internet and buy our stocks or bonds, fuck 'em.
This just tells me that one can work their way up further, the sky is the limit! Conversely, the further one can fall, the ground is the limit (unless rope is involved).
Union Pacific employee $107,540 ... Featherbedding 2015
If what I'm hearing is correct, top brass at one railroad (maybe more) want to eliminate the conductors. Just an engineer (you know, the guy tooting the big horn wearing the funny hat) would be responsible. I live in the vicinity where a major head-on collision took place. My mother and uncle were visiting and saw the huge black plume. Of course it was all over the news nationwide. Most recently, another head-on took place in northeast Arkansas.
If these jokers get their way, robotic control will take place for more of the freshly-printed FRN's covering their bottom line. Damned be the derailments and related disasters when someone hacks into their system, either at their dispatch centers or whilst in transit. Sheesh!!
Federal Budget Spending for Organization we can't even remember.
Rail Industry Pension Fund:
Benefit Payments outlay 2014: $4.9 Billion
Total--Railroad Retirement Board: $7.6 Billion
This article sounds like it was written by the Democratic National Committee in an attempt to promote class warfare.
What the CEO's in this article make is chump change to the robbery that goes on at other companies.
Take Twitter for example. 47% of their entire revenue stream went to pay executives. Last year that amounted to $170 Million. One guy Anthony Noto got paid $73 Million bucks for 6 months work.
http://www.marketwatch.com/story/twitters-latest-shareholder-slap-73-mil...
And if you want to see what others get paid that make the numbers in this chart seem somewhat trivial, check out this link from time to time:
http://finviz.com/insidertrading.ashx?or=-10&tv=100000&tc=7&o=-transacti...
A couple of Directors in Quest each took home $185,439,797 the week of Aug 5. And if you think $185 Million is a big payday, then check out how much this guy has taken in recently, $800 Million, large, just this year.
http://finviz.com/insidertrading.ashx?oc=1432313&tc=7&b=2
Or how about Howard Schultz over at Starbucks:
http://finviz.com/insidertrading.ashx?oc=901737&tc=7&b=2
Or maybe Peter Thiel, remember him from PayPal? He's now a Director at Facebook, and so far this year has managed to pick up $128 Million for well, being an outstanding Director, and all around nice guy, I guess.
http://finviz.com/insidertrading.ashx?oc=1211060&tc=7&b=2
Just click on the name link to pull up all the insider transactions, along with the Form 4 SEC link. Typical stupid SEC form. They list the number of shares, the quantity but not the dollar amount. I wonder why that is. Calculator at the SEC broken perhaps?
http://finviz.com/insidertrading.ashx?or=-10&tv=100000&tc=7&o=-transacti...
Shit, I didn't know JP Morgan staff flipped burgers.
How about we tweek this a littlie - how does the average C-suite compensation (rather than the simply the CEO) compare to the average employee? And - how do the layoff numbers compare ? And while I'm at it - do these CEO V. employee figures include all the foreign (eg Indian) employees ?
First of all, The title of the article says the CEOs are "overpaid." I saw nothing in the article proving they are overpaid. Just because they make a couple of hundred times what the troops make doesn't prove they are "over paid." Next, I don't lose a minute's sleep because somebody makes a pile of money. People who do lose sleep over somebody who makes a ton of money are just suffering from chronic envy. Get over it! And another thing, liberal cry-babies say the pay disparity keeps getting worse. No kidding! They are methematically challenged (Ha! Ha! That's PC teminology). As inflation marches on, CEO pay will always get higher and zero will always be zero so the difference can only grow bigger and bigger and bigger - so the petulent liberals will always have an issue to rant about.
LOOK AT WHERE THE PROFITS COME FROM...when you can shift "employee costs" onto taxpayers, then you boost profits which jacks up Exec pay/bonus. This cost shifting is just a piece of the big problem, but it is an important one.
"Cry-babying" about CEO's "employing" people in such a manner that allows them to shift the true costs of hiring them onto the backs of taxpayers in order TO MAXIMIZE THE CASH IN THE CEO's POCKET isn't "envy"...it's justifiable outrage!
McDonalds brought out a new salad last year. Sheer genius move by the CEO that no ordinary being could have conceived of. No matter that revenues went down the tubes. He's worth every cent.
However, you probably did not hear about his epic failure. He wanted to come out with the McAnus on a Stick. But the anus kept falling off the stick, so they used this shady puckering agent to make it cling. Turned out the puckering agent caused rectal cancer and they had to take it off the market pronto.
Bernie Sanders will fix those fucks.
He will utter the incantation "Ala Chavez" and it will be so.
Hey Firebrander, the way to fix business from using employee expenses to reduce business taxes is to do away with the income tax and establish a national sales tax. It will collect tax from illegal activities, eliminate the IRS because the sales tax can be transmitted immediately to the Treasury, eliminate the jobs of tax lawyers and tax accountants, make politicians stop promising tax breaks for special interests, save you many hours of record keeping and agonizing over filling out stupid forms, stop you from having to stuff your closets with 5 years of old tax records and 16 other benefits haven't thought of.