A new report highlights the increasingly bloated salaries of top corporate executives in America, while glossing over the fact that wages for almost everyone else have fallen or remained stagnant.
While some politicians tout the “trickle-down effect” that supposedly occurs when wealth is distributed so heavily at the top, we have yet to see that bear out in terms of job numbers or economic recovery.
Miami foreclosure lawyers know this has a direct impact on the housing market, and on the ability of people to maintain their mortgages, especially those who are still clinging to homes for which they are underwater.
While a Zillow report indicates poor and minority communities are still reeling from the housing crisis – with Hispanic communities suffering on average a 46 percent devaluation and black communities a 32 percent drop from the height of the bubble – meanwhile the pay of corporate CEOs highlights the growing divide.
Executives overseeing a Standard & Poor’s 500 company earned a record-breaking $10.5 million last year. This was an 8.8 percent increase from the $9.6 million earned on average in 2012.
These individuals include oilfield service companies, retail companies and beverage firms.
Increasingly, boards of directors have done away with stock options and cash bonuses for CEOs, which were largely viewed as a way executives could be rewarded even for poor performance. Today, more CEOs are receiving compensation in the form of actual stock, which increases in value when the company performs well.
While many companies say they are happy with the work of their CEOs, that doesn’t change the fact that these individuals are being paid at extraordinary levels for the work they do.
The highest-paid CEO, earned more than $68 million last year. The second-highest-paid earned $66 million.
Perhaps unsurprisingly, the industry with the biggest pay raise was: banking. Begging for bailouts just a few short years ago, the median pay of Wall Street CEOs last year climbed by 22 percent. That was after a 22 percent increase over the previous year. On average, these executives earned about $20 million annually.
But where the average CEO earned an 8.8 percent raise, the average U.S. worker got – at best – a 1.3 percent raise last year. To put this into perspective, the average U.S. employee would have to work nearly 260 years to make what the average CEO makes in a single year.
Economists say this kind of unbalanced approach is wrong. When we put all of our effort into rewarding those at the top and very little into ensuring the health and betterment of the workforce, the economy as a whole is weakened.
While these 500 executives were earning millions, there were nearly 8 million workers who earned between $23,000 and $25,000. This is an important bracket because it makes these workers just above the poverty line – so they aren’t eligible for public benefits. Workers who make $23,660 annually are at the minimum threshold at which employers can avoid requirements for overtime payment. Likely not coincidentally, there are more workers in this bracket than in any other.
Researchers say that if these workers were to be given a raise of just $2,000 annually, it would bolster the national income by $14.2 billion.
If you’re battling foreclosure in Miami or the surrounding areas contact Jacobs Keeley for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday from 5 p.m. to 6 p.m. on “Debt Warriors with Bruce Jacobs,” discussing foreclosure topics that matter to YOU.
Median CEO pay crosses $10 million in 2013, May 27, 2014, By Ken Sweet, Associated Press
More Blog Entries:
Working Poor Get Poorer, Top 0.1 Percent Get Richer, May 20, 2014, Miami Foreclosure Lawyer Blog