CEO compensation at the top 350 U.S. firms dipped in 2022 but remains enormous compared with the pay of other workers, according to a new Economic Policy Institute report. Average CEO compensation—including stock awards and options—was $25.2 million in 2022, a 14.8% decrease from 2021. This decline was overwhelmingly due to broad-based stock market declines in 2022.

Cumulatively, however, CEO compensation has skyrocketed 1,209.2% since 1978 compared with a 15.3% increase in a typical worker’s compensation. In 2022, CEOs were paid 344 times as much as a typical worker in contrast to 1965 when they were paid 21 times as much as a typical worker.

As the United Auto Workers (UAW) strike calls attention to soaring CEO pay, the report shows that high CEO pay has driven economic inequality, and it could be restrained without doing any damage to the wider economy.

“Exorbitant CEO pay is not just a symbolic issue—it has contributed to rising inequality. Escalating CEO pay in recent decades has spilled over to fuel wage growth at the top of the wage scale more generally, and this has left fewer gains for ordinary workers,” said Josh Bivens, EPI chief economist and co-author of the report.

CEO compensation has even been breaking away from that of other very highly paid workers. CEO compensation in 2021 was nearly eight times as much as the top 0.1% of wage earners. The large discrepancy between the pay of CEOs and other very-high-wage earners casts doubt on the claim that CEOs are being paid these extraordinary amounts because of their special skills and the market for those skills.

The authors outline several policy solutions that could limit CEOs’ ability to attain increasingly higher pay. These policies include reinstating higher income tax rates at the very top, using tax policy to incentivize lower CEO pay, allowing shareholders to vote on CEO compensation, and using antitrust enforcement and regulation to rein in the market power of the largest firms.

“Rising CEO pay does not reflect greater skills or contributions to firms’ productivity. What has changed over the years is CEOs’ use of their power to set their own pay. The overall economy would suffer no harm if CEOs were paid less or taxed more, and most workers would see gains,” said Jori Kandra, EPI research assistant and co-author of the report.