CEO compensation, CEO-to-worker compensation ratio, and stock prices (2018$), selected years, 1965–2018
| CEO annual compensation (thousands) | Private-sector production/nonsupervisory workers annual compensation (thousands) | Stock market (indexed to 2018$) | CEO-to-worker compensation ratio | |||||
|---|---|---|---|---|---|---|---|---|
| Based on options realized | Based on options granted | All private-sector workers | Workers in the firms’ industries* | S&P 500 | Dow Jones | Based on options realized | Based on options granted | |
| 1965 | $924 | $705 | $41.9 | n/a | 616 | 6,360 | 19.9 | 15.5 |
| 1973 | $1,206 | $920 | $49.2 | n/a | 544 | 4,681 | 22.2 | 17.2 |
| 1978 | $1,652 | $1,260 | $50.3 | n/a | 340 | 2,909 | 29.7 | 23.1 |
| 1989 | $3,077 | $2,347 | $47.9 | n/a | 633 | 4,922 | 58.1 | 45.1 |
| 1995 | $5,975 | $6,628 | $47.9 | $53.8 | 889 | 7,385 | 120.6 | 129.4 |
| 2000 | $21,549 | $21,542 | $50.6 | $56.5 | 2,087 | 15,681 | 368.1 | 386.4 |
| 2007 | $20,027 | $14,000 | $52.7 | $58.8 | 1,793 | 15,999 | 345.9 | 241.1 |
| 2009 | $11,255 | $10,785 | $54.7 | $61.2 | 1,112 | 10,425 | 195.3 | 182.3 |
| 2016 | $16,045 | $12,775 | $55.8 | $63.8 | 2,192 | 18,759 | 262.6 | 209.0 |
| 2017 | $17,270 | $12,698 | $56.0 | $64.6 | 2,509 | 22,280 | 280.8 | 205.7 |
| Projected 2018 | $17,180 | $13,952 | $56.2 | $64.5 | 2,746 | 25,047 | 278.1 | 221.0 |
| 2017 FH | $16,760 | $12,298 | $56.0 | $64.6 | 2,509 | 22,280 | 272.7 | 200.4 |
| 2018 FH | $16,672 | $13,511 | $56.2 | $64.5 | 2,746 | 25,047 | 269.9 | 215.7 |
| Percent change | Change in ratio | |||||||
| 1965–1978 | 78.7% | 78.7% | 19.9% | n/a | -44.7% | -54.3% | 9.8 | 7.6 |
| 1978–2000 | 1,204.8% | 1,610.1% | 0.7% | n/a | 513.0% | 439.1% | 338.3 | 363.4 |
| 2000–2018 | -20.3% | -35.2% | 11.1% | 14.1% | 31.6% | 59.7% | -90.0 | -165.4 |
| 2009–2018 | 52.6% | 29.4% | 2.7% | 5.3% | 146.9% | 140.3% | 82.8 | 38.7 |
| 1978–2018 | 940.3% | 1,007.5% | 11.9% | n/a | 706.7% | 761.1% | 248.4 | 198.0 |
| 2017–2018 | -0.5% | 9.9% | 0.5% | -0.2% | 9.5% | 12.4% | -2.7 | 15.3 |
* Average annual compensation of the workers in the key industries of the firms in the sample.
Notes: CEO average annual compensation is measured for CEOs at the top 350 U.S. firms ranked by sales. Two measures are computed, differing in the treatment of stock options: One uses “options realized,” and the other uses the value of “options granted.” Both series also include salary, bonus, restricted stock awards, and long-term incentive payouts for CEOs. Projected value for 2018 is based on the percent change in CEO pay in the samples available in June 2017 and in June 2018 (labeled first-half [FH] data) applied to the full-year 2017 value. CEO-to-worker compensation ratios are based on averaging specific firm ratios in samples and not the ratio of averages of CEO and worker compensation. Ratios prior to 1992 are constructed as described in the CEO pay series methodology (Sabadish and Mishel 2013).
Source: Authors’ analysis of data from Compustat’s ExecuComp database, the Federal Reserve Economic Data (FRED) database from the Federal Reserve Bank of St. Louis, the Bureau of Labor Statistics’ Current Employment Statistics data series, and the Bureau of Economic Analysis NIPA tables