2013 CEO-to-Worker Pay Ratio

In 2013 the CEO-to-worker pay ratio was 331:1 and the CEO-to-minimum-wage-worker pay ratio was 774:1. America is supposed to be the land of opportunity, a country where hard work and playing by the rules would provide working families a middle-class standard of living. But in recent decades, corporate CEOs have been taking a greater share of the economic pie while wages have stagnated and unemployment remains high.

Highly paid CEOs of low-wage employers are fueling this growing economic inequality. In 2013, CEOs of the Standard & Poor’s (S&P) 500 Index companies received, on average, $11.7 million in total compensation, according to the AFL-CIO’s analysis of available data from 350 companies.

Today’s ratio of CEO-to-worker pay is simply unconscionable. While CEO pay remains in the stratosphere, production and nonsupervisory workers took home only $35,239 on average in 2013, and a full-time worker making the federal minimum wage earned only $15,080.

Even as companies argue that they can’t afford to raise wages, the nation’s largest companies are earning higher profits per employee than they did five years ago. In 2013, the S&P 500 Index companies earned $41,249 in profits per employee, a 38% increase.

It doesn't have to be this way. Politicians should raise the minimum wage. Corporations should pay their employees a living wage. And workers should have a collective voice on the job to demand their fair share.

    *2013 CEO to average worker pay ratio calculated based on AFL-CIO analysis of 350 available companies in the S&P 500. Average worker pay according to Bureau of Labor Statistics data for production and nonsupervisory workers.

    Hourly CEO pay assumes 52 40-hour workweeks using the CEO's total compensation. All data are actual, derived from proxy statements, except for John Legere's, which is an estimate of 2013 compensation based on the Employment Agreement on Sept. 22, 2012, using target amounts for bonus and nonequity incentive compensation.

    Walmart Worker

    I have been working at Walmart for nearly three years as a customer service manager in Laurel, Md., after working at a Walmart store in Louisiana. I am a proud wife and a mother of two girls.

    I earned about $12,000 last year as a full-time employee. These poverty wages force my family to receive public assistance. Currently, we are enrolled in the public health care program for low-income families and the Women, Infants and Children (WIC) program for my infant daughter.

    I was not earning enough to pay for child care, so I had to make the hard choice to work fewer hours in order to care for my daughter.

    Walmart doesn’t value me, my co-workers and our hard work, so I became involved in the worker empowerment movement and am speaking out, standing up and calling for the company to publicly commit to ending its unfair labor practices, provide all of its workers with a fair wage, good jobs and enough hours to be able to support our families.

    So far Walmart has responded through retaliation. For example, the General Counsel of the National Labor Relations Board has alleged Colby Harris, a fellow OUR Walmart member, was fired last year for exercising his rights and for calling on Walmart to end its illegal retaliation against workers. All he wanted to do was make Walmart a better place to shop and work. We just want an opportunity to support ourselves and be valued.

    I believe in working hard and that my work should be valued. That is why I fight and that is why I will not stop fighting until Walmart commits to raising wages and begins valuing all of its workers.

      Demographics of Minimum Wage Workers

      Percentage of workers, by race, earning at or below the minimum wage

      Characteristics of Minimum Wage Workers: 2013, BLS. Where’s the Diversity in Fortune 500 CEOs? DiversityInc.

      Darden Worker: Sissy

      I am a 54-year-old server for a Darden restaurant. Their brands include Olive Garden, Red Lobster, Longhorn Steakhouse, Capital Grille and a few others. I prefer not to give my real name or place of employment for fear of retaliation.

      I started in the restaurant industry in 1975 at a fast food restaurant and eventually moved my way “up” in the industry to a waitstaff position. I was a single parent and was proud to have a steady job. Yet I only earned $1.81 an hour plus tips, which wasn’t enough to live on without government assistance. Some days, it wasn’t enough to pay the babysitter.

      I decided to go to culinary school and studied to become a chef. I hoped it would provide stable, steady income, but I didn’t realize that most of the kitchen jobs paid minimum wage. I ended up cooking during the day and waiting tables at night.

      Thirty-nine years later, I landed what is considered one of the best jobs in the industry—a “fine dining” server position. I considered it a “career job,” promising health care, a 401(k) and profit sharing. I remember feeling how blessed and happy I was and how I could finally begin to save for my retirement.

      That was unrealistic. My wage of $2.83 an hour goes to pay for just a fraction of the taxes I owe each year. I have no money in my paycheck to contribute to the 401(k), let alone for profit-sharing.

      I want to keep this “good” job so I try to stay positive for fear of being written up, but my hours are regularly cut if the restaurant is slow; the only time I can guarantee a full schedule is the holiday season. I’ve lost my health care and have been demoted to food runner every week “to keep me humble.”

      The future, when I think of it, only brings a tremendous amount of fear. I cry a lot at night. It is overwhelming not knowing if I will be able to maintain my living conditions.

      I find it ironic that part of my job is to treat people with respect, honesty, dignity and integrity and that the corporation doesn’t do the same for its employees.

        Real Value of the Minimum Wage

        If the minimum wage would have kept up with productivity and the income gains of the top 1% since 1968, it would be $18.30 and $31.45, respectively.

        Raising the federal minimum wage to $10.10 would give working families, and the overall economy, a much-needed boost, David Cooper and Doug Hall.

        Tobacco Farm Worker:

        I came to the United States from Mexico in 2006, driven by a dream we all share: a better life for my family. What I found, however, is suffering.

        Fernando is not my real name; I am an undocumented worker and, therefore, I have to protect my identity. I have six children and a wife to support, so I harvest tobacco. My job is dangerous. I am exposed to the chemicals farmers use on their fields, and so I get sick a lot. When I don’t feel well enough to work, I still have to go in or I face retaliation. I make $7.25 an hour.

        Another illness associated with tobacco harvesting is green tobacco sickness. It is a poisoning from nicotine being absorbed through the skin. I cough up blood, get nose bleeds, vomit and have frequent bouts of diarrhea. My eyes are constantly red. The vapors from the boxes of tobacco exacerbate my chronic cough. This lasts the whole season.

        As a farmworker in the supply chain for tobacco, I think it should be an obligation from the boss to pay our wages even when we are ill—when one has been helping him throughout the season. But if I don’t go to work, I won’t get paid.

        I don’t earn enough to cover major medical expenses. Once, a fall put me in the hospital for two days. I got the bill from the regional hospital and I paid for the medicines, but I could not pay for the hospital stay. It was too much. When my arm and hand were caught in the machine, the doctor gave me two weeks off work. But the boss only gave me two days off work. And that is how I ended up with all these ailments—there is not enough time to recover.

        All the boss is interested in is that we work fast. He scolds and yells and makes us work almost by force. We don’t matter to him.

          Pay Ratio by State

          T-Mobile Worker: Ellen

          I am the face of T-Mobile US. I work as a customer service representative for the T-Mobile call center in Wichita, Kan. I troubleshoot everything, from handset issues to rate plan questions to billing problems. I have been working at T-Mobile for nearly two years. I make $11.46 an hour.

          As a single mother with two adorable children, Jude and Lyla, I don’t earn enough money to make ends meet, so I still have to rely on government assistance, including food stamps and subsidized day care.

          I like helping people. That’s why I chose customer service. I try to find the best solution to a customer’s needs. I like to think that I enable people all over the United States to get the most they can from their wireless devices.

          My work is very stressful. Sometime callers are angry about previous service or something is not right about their service or their bill. The company expects me to be smooth and reassuring, regardless of the customer. The company expects me to solve the problem in 370 seconds—a little more than six minutes. Otherwise, I am dinged on my performance metrics, and those metrics determine any bonus I may receive or the shift I will work.

          I am expected to be on the phone 96% of the time I am at work. The other 4% is really a buffer. If I am on a call that runs into my scheduled break or lunchtime, it counts against my commitment to schedule. This is hard for me but impossible for some of my pregnant co-workers. They are forced to clock out (and lose income) just to use the bathroom.

          I fear for my job not because I am doing poorly but because I am an at-will employee, as the company is fond of reminding me. The company can make life so miserable for you that you will quit. Or my metrics might slip and I could get a schedule that wouldn’t work with my kids. Or management just may get tired of my union activism.

          I am a proud and active member in CWA-TU, the union of T-Mobile workers, and my hope is that someday workers at T-Mobile will have better pay, working conditions and the respect all workers deserve.

            Kellogg Worker: Kevin

            For the past 13 years, I have worked for Kellogg Co. at its Memphis, Tenn., cereal plant as a sealing case operator and a packing trainer. I am one of 226 production and maintenance employees and we produce roughly 180 million tons of cereal each year, mostly Frosted Flakes and Froot Loops. Six months ago, Kellogg locked out its hardworking and loyal employees because the company wanted to hire temporary workers who would earn $6 an hour less than its current workers and earn no benefits.

            This plant 10 years ago had nearly double the number of workers producing about the same amount of cereal, so its small production and maintenance employees are now required to work a “28-and-two schedule” to meet its production goals. This means working 28 days in a row with 12- and 16-hour shifts and then getting two days off. Then the rotation starts over again.

            Kellogg says its labor cost puts it in an unsustainable position in the cereal market. It costs about 37 cents a pound, says Kellogg, to produce, package and ship the product to the grocery shelf. A box of cereal sells for an average of $4.30 per box. Yet, somehow, last year the company found a way to give its CEO a 21% raise, putting his total compensation for 2013 at $8 million.

            Kellogg is using labor costs as a scapegoat when it’s making money hand over fist. It seems even grotesque profits are not enough for this company!