The State of Working America, 12th edition: Coming Tuesday, Sept. 11

The State of Working America is EPI’s authoritative analysis of the economic conditions of America’s workers. Visit StateofWorkingAmerica.org for up-to-date numbers on the economy, updated when new data are released.


Aug. 29: Unions, inequality, and faltering middle-class wages

Figure AFigure A (continued)

Union coverage rate in the United States, 1973–2011

Source: Author's analysis of Hirsch and Macpherson (2003) and updates from the Union Membership and Coverage Database

 


July 24: U.S. poverty rates higher, safety net weaker than in peer countries

Figure DFigure D (continued)

Child poverty rate in selected developed countries, 2009

Note: The child poverty rate is the share of children living in households with income below half of household-size-adjusted median income.

Source: Adamson (2012, Figure 1b)


May 24: Labor force participation: Cyclical versus structural changes since the start of the Great Recession


May 2: CEO pay and the top 1%: How executive compensation and financial-sector pay have fueled income inequality

Figure AFigure A (continued)

CEO-to-worker compensation ratio, with options granted and options realized,1965–2011

Note: "Options granted" compensation series includes salary, bonus, restricted stock grants, options granted, and long-term incentive payouts for CEOs at the top 350 firms ranked by sales. "Options exercised" compensation series includes salary, bonus, restricted stock grants, options exercised, and long-term incentive payouts for CEOs at the top 350 firms ranked by sales.

Sources: Authors' analysis of data from Compustat ExecuComp database, Bureau of Labor Statistics Current Employment Statistics program, and Bureau of Economic Analysis National Income and Product Accounts Tables


April 26: The wedges between productivity and median compensation growth

”Figure”Figure (continued)

CEO Compensation in 2018

Table 1

Change in CEO compensation and components, 2016–2018

CEO annual compensation (thousands) Components of compensation (thousands)
Stock options:
Year Options realized* Options granted Salary Bonus Nonequity Incentives Stock awards, fair value Value exercised Fair value awarded
(1)=3+4+5+6+7 (2)=3+4+5+6+8 (3) (4) (5) (6) (7) (8)
CEO compensation levels ($2018)
2016 16,045 12,775 1,327 402 2,733 6,339 5,243 1,973
2017 17,270 12,698 1,284 342 2,866 6,120 6,658 2,086
Projected 2018 17,180 13,952 1,267 258 2,898 7,549 5,248 2,006
Change, 2016–17
Level 1226 -77 -43 -60 133 -220 1415 113
Percentage 7.6% -0.6% -3.2% -14.9% 4.9% -3.5% 27.0% 5.7%
Change, 2017–18
Level -90.1 1,253.2 -17.8 -84.3 31.6 1,429.3 -1,409.7 -80.0
Percentage -0.5% 9.9% -1.4% -24.6% 1.1% 23.4% -21.2% -3.8%
Change, 2016–18
Level 1135 1177 -61 -144 165 1210 5 33
Percentage 7.1% 9.2% -4.6% -35.9% 6.0% 19.1% 0.1% 1.7%

Notes: CEO annual compensation is computed using the “options realized” and “options granted” compensation series for CEOs at the top 350 U.S. firms ranked by sales. The “options realized” series includes salary, bonus, restricted stock grants, options realized, and long-term incentive payouts. The “options granted” series includes salary, bonus, restricted stock grants, options granted, and long-term incentive payouts. Projected value for 2018 is based on the change in CEO pay as measured from June 2017 to June 2018 applied to the full-year 2017 value. Projections for compensation based on options granted and options realized are calculated separately.

Source: Authors’ analysis of data from Compustat’s ExecuComp database, the Bureau of Labor Statistics’ Current Employment Statistics data series, and the Bureau of Economic Analysis NIPA tables

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Table 2

CEO compensation, CEO-to-worker compensation ratio, and stock prices (2018 dollars), 1965–2018

CEO annual compensation (in thousands)* Private-sector production/nonsupervisory workers annual compensation (in thousands) Stock market (indexed to $2018) CEO-to-worker compensation ratio***
Based on options realized Based on options granted All private-sector workers Firms’ industry** 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
2017 17,270 12,698 56 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
2017 FH 16,760 12,298 56 64.6 2,192 18,759 272.7 200.4
2018 FH 16,672 13,511 56.2 64.5 2,509 22,280 269.9 215.7
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 1204.8% 1610.1% 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 -165.4
2009-2018 52.6% 29.4% 2.7% 5.3% 146.9% 140.3% 82.8 38.7
1978–2018 940.3% 1007.5% 11.9% n/a 706.7% 761.1% 248.4 198
2017–2018 -0.5% 9.9% 0.5% -0.2% 9.5% 12.4% -2.7 15.3

*CEO annual compensation is computed using the “options realized” and “options granted” compensation series for CEOs at the top 350 U.S. firms ranked by sales. The “options realized” series includes salary, bonus, restricted stock grants, options realized, and long-term incentive payouts for CEOs at the top 350 U.S. firms ranked by sales. The “options granted” series includes salary, bonus, restricted stock grants, value of options granted, and long-term incentive payouts.
**Annual compensation of the workers in the key industry of the firms in the sample.
***Based on averaging specific firm ratios and not the ratio of averages of CEO and worker compensation.

Notes: Projected value for 2018 is based on the change in CEO pay as measured from June 2017 to June 2018 applied to the full-year 2017 value. Projections for compensation based on options granted and options realized are calculated separately. “FH” denotes preliminary values from the “first half” of the year.

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

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Figure A

CEO realized direct compensation and the S&P 500 index (2018 dollars), 1965–2018

Year CEO compensation (in millions of 2018 dollars) S&P 500 index
1965 0.92 615.63
1966 0.99 578.37
1967 1.07 605.71
1968 1.15 623.87
1969 1.16 593.31
1970 1.17 481.49
1971 1.18 545.42
1972 1.19 587.67
1973 1.21 544.24
1974 1.28 381.35
1975 1.37 366.64
1976 1.46 410.69
1977 1.55 371.43
1978 1.65 340.44
1979 1.75 333.24
1980 1.85 345.39
1981 1.96 340.4
1982 2.07 300.13
1983 2.19 385.84
1984 2.32 370.4
1985 2.45 416.91
1986 2.6 518.49
1987 2.75 608.56
1988 2.91 544.12
1989 3.08 633.42
1990 3.72 625.3
1991 4.51 678.28
1992 5.45 731.42
1993 5.74 774.97
1994 4.66 773.92
1995 5.97 889.16
1996 7.79 1,071.99
1997 11.83 1,366.88
1998 17.29 1,676.07
1999 15.59 2,006.73
2000 21.55 2,086.94
2001 11.96 1,697.84
2002 10.33 1,391.22
2003 13.32 1,321.03
2004 15.05 1,506.72
2005 18.23 1,556.06
2006 19.65 1,636.08
2007 20.03 1,793.38
2008 14.09 1,426.40
2009 11.26 1,112.27
2010 13.25 1,315.73
2011 13.57 1,418.37
2012 15.8 1,511.36
2013 16.38 1,774.82
2014 17.27 2,050.60
2015 16.93 2,184.53
2016 16.04 2,191.86
2017 17.27 2,508.78
2018 17.18 2,746.21
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Notes: CEO annual compensation is computed using the “options realized” compensation series, which includes salary, bonus, restricted stock grants, options realized, and long-term incentive payouts for CEOs at the top 350 U.S. firms ranked by sales. Projected value for 2018 is based on the change in CEO pay as measured from June 2017 to June 2018 applied to the full-year 2017 value.

Source: Authors’ analysis of data from Compustat’s ExecuComp database and the Federal Reserve Economic Data (FRED) database from the Federal Reserve Bank of St. Louis

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Figure B

Comparison of option and stock components of CEO pay, 2006–2018

Options realized and stock awards as a share of CEO compensation based on options realized

Options realized Stock awards, fair value Both
2006 47.8% 21.9% 0%
2007 50.2% 25.5% 0%
2008 33.9% 35.9% 0%
2009 26.7% 35.7% 0%
2010 29.4% 34.2% 0%
2011 29.4% 35.3% 0%
2012 38.8% 33.0% 0%
2013 37.9% 34.7% 0%
2014 36.4% 36.9% 0%
2015 34.9% 37.2% 0%
2016 32.7% 39.5% 0%
2017 38.6% 35.4% 0%
2018 FH 30.8% 43.1% 0%
2018 (Proj.) 30.5% 43.9% 0%
ChartData

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Options granted and stock awards as a share of CEO compensation based on options granted

Options granted Stock awards, fair value Both
2006 25.3% 29.8% 0%
2007 28.7% 36.5% 0%
2008 28.2% 39.0% 0%
2009 23.5% 37.2% 0%
2010 23.0% 37.3% 0%
2011 23.6% 38.1% 0%
2012 19.4% 43.4% 0%
2013 18.6% 45.5% 0%
2014 15.0% 49.3% 0%
2015 13.8% 49.3% 0%
2016 15.4% 49.6% 0%
2017 16.4% 48.2% 0%
2018 FH 14.6% 53.2% 0%
2018 (Proj.) 14.4% 54.1% 0%
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Notes: CEO annual compensation is computed using the “options realized” and “options granted” compensation series for CEOs at the top 350 U.S. firms ranked by sales. The “options realized” series includes salary, bonus, restricted stock grants, options realized, and long-term incentive payouts. The “options granted” series includes salary, bonus, restricted stock grants, options granted, and long-term incentive payouts. Projected value for 2018 is based on the change in CEO pay as measured from June 2017 to June 2018 applied to the full-year 2017 value. Projections for compensation based on options granted and options realized are calculated separately. FH” denotes preliminary values from the “first half” of the year.

Source: Authors’ analysis of data from Compustat’s ExecuComp database, the Bureau of Labor Statistics’ Current Employment Statistics data series, and the Bureau of Economic Analysis NIPA tables

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Figure C

CEOs make 278 times more than typical workers: CEO-to-worker compensation ratio, 1965–2018

Year CEO-to-worker compensation ratio based on options realized CEO-to-worker compensation ratio based on options granted
1965 19.9 15.5
1966 21.1 16.3
1967 22.3 17.3
1968 23.5 18.2
1969 23.2 23.2
1970 23.0 23.0
1971 22.7 22.7
1972 22.4 22.4
1973 22.2 17.2
1974 23.5 23.5
1975 24.9 24.9
1976 26.4 26.4
1977 28.0 28.0
1978 29.7 23.1
1979 31.6 24.5
1980 33.6 26.1
1981 35.7 27.7
1982 37.9 29.4
1983 40.3 31.3
1984 42.9 33.2
1985 45.5 35.3
1986 48.4 37.6
1987 51.5 39.9
1988 54.7 42.4
1989 58.1 45.1
1990 70.4 54.6
1991 85.2 66.1
1992 103.2 80.0
1993 114.4 99.3
1994 86.5 116.2
1995 120.6 129.4
1996 154.1 181.4
1997 225.2 236.3
1998 294.8 293.0
1999 265.6 283.8
2000 368.1 386.4
2001 210.4 321.9
2002 186.4 234.7
2003 228.7 226.9
2004 265.0 234.3
2005 320.1 245.1
2006 342.2 250.9
2007 345.9 241.1
2008 237.8 225.3
2009 195.3 182.3
2010 225.1 203.3
2011 233.0 213.5
2012 275.7 205.3
2013 290.5 211.8
2014 296.4 221.4
2015 284.3 214.8
2016 262.6 209.0
2017 280.8 215.7
2018 278.1 221.0
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Notes: CEO annual compensation is computed using the “options realized” and “options granted” compensation series for CEOs at the top 350 U.S. firms ranked by sales. The “options realized” series includes salary, bonus, restricted stock grants, options realized, and long-term incentive payouts. The “options granted” series includes salary, bonus, restricted stock grants, options granted, and long-term incentive payouts. Projected value for 2018 is based on the change in CEO pay as measured from June 2017 to June 2018 applied to the full-year 2017 value. Projections for compensation based on options granted and options realized are calculated separately. “Typical worker” compensation is the average annual compensation of the workers in the key industry of the firms in the sample.

Source: Authors’ analysis of data from Compustat’s ExecuComp database, the Bureau of Labor Statistics’ Current Employment Statistics data series, and the Bureau of Economic Analysis NIPA tables

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Table 3

CEO-to-top-0.1-percent and college-to-high-school ratios, 1979–2017

Ratio Log ratio
CEO compensation to: College wages to: CEO compensation to: College wages to:
Top 0.1% wage earners High school hourly wages Top 0.1% wage earners High school hourly wages
1979 3.26 1.41 1.18 0.35
1989 2.63 1.59 0.97 0.46
1993 3.05 1.64 1.11 0.49
2000 7.77 1.75 2.05 0.56
2007 4.36 1.77 1.47 0.57
2009 4.61 1.74 1.53 0.55
2016 5.41 1.84 1.69 0.61
2017 5.40 1.82 1.69 0.60
Change
1979–2007 1.10 0.35 0.29 0.22
1979–2017 2.13 0.43 0.50 0.25
1989–2017 2.77 0.26 0.72 0.13

Source: Authors’ analysis of data on top 0.1 percent wages from the EPI State of Working America Data Library, Mishel and Wolfe 2018, and extrapolation of Kaplan’s (2012b) CEO compensation series

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Figure D

Comparison of CEO compensation with top 0.1 percent wages, 1947–2017

Year  Ratio of CEO pay to top 0.1% wages 1947–1979 average ratio: 3.18
1947 3.54 3.18
1948 3.14 3.18
1949 3.55 3.18
1950 3.02 3.18
1951 3.02 3.18
1952 2.95 3.18
1953 3.29 3.18
1954 3.42 3.18
1955 3.44 3.18
1956 3.40 3.18
1957 3.79 3.18
1958 3.79 3.18
1959 4.23 3.18
1960 3.26 3.18
1961 3.54 3.18
1962 3.55 3.18
1963 3.65 3.18
1964 3.41 3.18
1965 3.32 3.18
1966 3.14 3.18
1967 3.09 3.18
1968 3.02 3.18
1969 3.10 3.18
1970 3.00 3.18
1971 2.85 3.18
1972 2.93 3.18
1973 2.72 3.18
1974 2.70 3.18
1975 2.29 3.18
1976 2.33 3.18
1977 2.43 3.18
1978 2.82 3.18
1979 3.26 3.18
1980 2.76 3.18
1981 2.98 3.18
1982 2.79 3.18
1983 2.79 3.18
1984 2.57 3.18
1985 3.12 3.18
1986 2.92 3.18
1987 2.62 3.18
1988 2.38 3.18
1989 2.63 3.18
1990 2.75 3.18
1991 3.12 3.18
1992 2.84 3.18
1993 3.05 3.18
1994 3.99 3.18
1995 4.11 3.18
1996 5.50 3.18
1997 5.28 3.18
1998 5.91 3.18
1999 6.03 3.18
2000 7.77 3.18
2001 6.88 3.18
2002 6.10 3.18
2003 5.40 3.18
2004 5.28 3.18
2005 5.00 3.18
2006 5.18 3.18
2007 4.36 3.18
2008 4.56 3.18
2009 4.61 3.18
2010 4.85 3.18
2011 4.96 3.18
2012 5.11 3.18
2013 5.83 3.18
2014 5.64 3.18
2015 5.35 3.18
2016 5.41 3.18
2017 5.40 3.18
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Source: Authors’ analysis of data on top 0.1 percent wages from Mishel and Wolfe 2018 and extrapolation of Kaplan’s (2012b) CEO compensation series

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March 7: Entry-level workers’ wages fell in lost decade

Figure BFigure B (continued)

Entry-level wages of male and female college graduates


Other media outlets and blogs that have covered the data include BBC News, Forbes, Gawker, Huffington Post, In These Times, MarketPlace RadioNational Journal, PoliticoReuters, Village Voice, and the Washington Post.