Executive Excess 2010: CEO Pay and the Great Recession

Will measures like these rein in excessive executive rewards? Will they begin to significantly narrow the corporate pay gap? That appears doubtful. The UK, for instance, has had a “say on pay” provision on the books since 2002, and that provision has not prevented a continuing executive pay spiral. Despite the recession, UK executive compensation sits substantially above pre-“say on pay” levels. To bring executive pay back down to mid-20th century levels, we need reforms that cut to the quick, that recognize the dangers banks and major corporations create when they dangle oversized rewards for executive “performance.” Some reforms that would move us in that direction are now pending in Congress. Others have yet to make their way onto the congressional docket.


By Sarah Anderson, Chuck Collins, Sam Pizzigati, Kevin Shih

The 17th annual executive compensation survey looks at how CEOs laid off thousands while raking in millions.

CEO pay 2010 coverAmerica’s CEOs had a terribly rough 2009. Or so the national and regional executive pay surveys released so far this year would suggest. “CEOs See Pay Fall Again,” blared one headline early this past spring. “CEO pay rankings dominated by large salary cuts,” read another in June. “Silicon Valley bosses,” summed up still another, “get pay cut.” Month after month, the headlines have pounded home a remarkably consistent message: Corporate executives, here in the Great Recession, are suffering, too.

Corporate executives, in reality, are not suffering at all. Their pay, to be sure, dipped on average in 2009 from 2008 levels, just as their pay in 2008, the first Great Recession year, dipped somewhat from 2007. But executive pay overall remains far above inflationadjusted levels of years past. In fact, after adjusting for inflation, CEO pay in 2009 more than doubled the CEO pay average for the decade of the 1990s, more than quadrupled the CEO pay average for the 1980s, and ran approximately eight times the CEO average for all the decades of the mid-20th century.

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, we calculate in the 17th annual Executive Excess, CEOs of major U.S. corporations averaged 263 times the average compensation of American workers. CEOs are clearly not hurting. Leer más “Executive Excess 2010: CEO Pay and the Great Recession”

CEOs Who Cut the Most Jobs Earn More than Peers

CEOs of the 50 firms that have laid off the most workers since the onset of the economic crisis took home 42 percent more pay in 2009 than their peers at S&P 500 firms, according to “CEO Pay and the Great Recession,” the 17th in a series of annual Executive Excess reports from the Institute for Policy Studies.

“Our findings illustrate the great unfairness of the Great Recession,” says Sarah Anderson, lead author on the Institute study. “CEOs are squeezing workers to boost short-term profits and fatten their own paychecks.”

The 50 top CEO layoff leaders received $12 million on average in 2009, compared to the S&P 500 average of $8.5 million. Each of the corporations surveyed laid off at least 3,000 workers between November 2008 and April 2010. Seventy-two percent of the firms announced mass layoffs at a time of positive earnings reports.


CEOs of the 50 firms that have laid off the most workers since the onset of the economic crisis took home 42 percent more pay in 2009 than their peers at S&P 500 firms, according to “CEO Pay and the Great Recession,” the 17th in a series of annual Executive Excess reports from the Institute for Policy Studies.

“Our findings illustrate the great unfairness of the Great Recession,” says Sarah Anderson, lead author on the Institute study. “CEOs are squeezing workers to boost short-term profits and fatten their own paychecks.”

The 50 top CEO layoff leaders received $12 million on average in 2009, compared to the S&P 500 average of $8.5 million. Each of the corporations surveyed laid off at least 3,000 workers between November 2008 and April 2010. Seventy-two percent of the firms announced mass layoffs at a time of positive earnings reports.

Highest-Paid “Layoff Leaders”:

  • Fred Hassan, Schering-Plough: Hassan received a $33 million golden parachute when his firm merged with Merck in late 2009, while 16,000 workers faced pink slips. Hassan’s total 2009 pay of nearly $50 million could cover the average cost of these workers’ jobless benefits for more than 10 weeks.
  • William Weldon, Johnson & Johnson: Weldon took home $25.6 million, more than three times as much as the S&P 500 CEO average, at a time when his firm was slashing 9,000 jobs and facing a massive drug recall scandal.
  • Mark Hurd, Hewlett-Packard: While his failure to cover up a relationship with a contractor/erotic film star has been banner news, Hurd’s slashing of 6,400 jobs last year has largely escaped the headlines. After getting the axe himself in August, Hurd added more than $28 million severance to his 2009 pay package of $24.2 million. Leer más “CEOs Who Cut the Most Jobs Earn More than Peers”