Amid decades-high inflation, worker wages are failing to keep pace with the rise in everyday expenses, but CEOs have not felt the same brunt.
Among S&P 500 companies, CEO pay rose 18.2% in 2021, far outpacing the U.S. inflation rate of 7.1% last year, according to a report Monday from the AFL-CIO, the country’s largest labor union federation. Meanwhile, U.S. nominal worker wages grew only 4.7% over the same period, meaning their buying power fell 2.4%.
“It’s another version of ‘more for them and less for us,’” AFL-CIO Secretary-Treasurer Fred Redmond, said during a call with media Monday to unveil the report. “And it comes at a time when working people’s living standards have declined with every increase in the price of food, rent, and gas.”
In another sign of executive largess, CEOs of S&P 500 companies made $18.3 million on average in 2021, 324 times more than the wages their median employees received. It was the largest gap since the AFL-CIO began tracking the figure in 2018. The year before, in 2020, the average S&P 500 CEO made 299 times the pay of their company’s typical worker.
The AFL-CIO pointed to these trends as evidence of “greedflation”—the claim that companies have engaged in price gouging that exceeds their rising costs, using inflation as an excuse to boost profits. Corporate profits in the S&P 500 saw a 17.6% increase in 2021, a little less than the acceleration in CEO pay, per the report.
Based on June’s CPI report, the federal minimum wage, adjusted for inflation, sank to its lowest value than at any point since 1956, according to the Economic Policy Institute.
The AFL-CIO report named Amazon as the S&P 500 company that paid its CEO the most compared to its median worker. In 2021, CEO Andy Jassy received a $213 million pay package, while the typical Amazon worker earned 6,474 times less with a salary of $32,855, according to the company’s proxy statement.
An Amazon spokesperson said the bulk of Jassy’s compensation came from a special stock award tied to his promotion to CEO last year, intended to represent most of his compensation for the coming years.
“The way the SEC rules work we are required to report that grant as total compensation for 2021, when in reality it will vest over the next 10 years,” the spokesperson said. “What this equates to from an annual compensation perspective is competitive with that of CEOs at other large companies.”
But Jassy was not the highest-paid CEO in the S&P 500. That title went to Expedia Group CEO Peter Kern, who earned more than $296 million, the report said. With that pay package, Kern had the second greatest CEO-to-worker ratio, making 2,897 times more than his median employee’s salary of $102,270.
Expedia pointed out that according to the company’s proxy statement, most of Kern’s compensation is in long-term equity awards, which will not fully vest until between 2024 and 2026 at the earliest.
