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Median Compensation for CEOs Climbed Above $10 Million in 2013
A pay study performed by Equilar and the Associated Press found that the leader of a typical large public company earned a record $10.5 million in 2013, which is an 8.8 percent increase from 2012. For the first time, the median compensation for a CEO climbed above eight figures in 2013.
After a decline during the Great Recession, 2013 marked the fourth consecutive year that compensation for CEOs increased. During that period, the median compensation package increased by 50 percent. A CEO brings home 257 times more than the average worker’s salary, which is a massive increase over the 181 times back in 2009.
Carol Meyrowitz is the CEO of TJX, which owns Marshall’s and TJ Maxx. She is the highest paid female CEO.
“Companies have been happy with their CEOs’ performance and the stock market has provided a big boost,” says Gary Hewitt, director of research at GMI Ratings. “But we are still dealing with a situation where CEO compensation has spun out of control and CEOs are being paid extraordinary levels for their work.”
Anthony Petrello was the highest paid CEO. He is the CEO of Nabors Industries and made $68.3 million in 2013. Petrello’s compensation exploded because the company bought out his old contract for $60 million.
Leslie Moonves, the CEO of CBS, was paid $65.6 million in 2013 as the stock of the company rose 70 percent.
“CBS’s share appreciation was not only the highest among major media companies, it was near the top of the entire S&P 500,” CBS said in a statement. “Mr. Moonves’ compensation is reflective of his continued strong leadership.”
The compensation for CEOs continues to be a major issue in the United States. Companies claim they need to provide massive compensation packages in order to lure the most talented individuals to companies that are multibillion-dollar businesses.
“If you have a good CEO at a company, the wealth he might generate for shareholders could be in the billions,” says Dan Mitchell, a senior fellow at the Cato Institute. “It might be worth paying these guys millions for doing this type of work.”
CEO pay increased by 8.8 percent last year while the average raise for workers in the country raised by just 1.3 percent, according to data from the Bureau of Labor Statistics.
“There’s this unbalanced approach, where there’s all this energy put into how to reward executives, but little energy being put into ensuring the rest of the workforce is engaged, productive and paid appropriately,” says Richard Clayton, research director at Change to Win Investment Group.Median Compensation for CEOs Climbed Above $10 Million in 2013 by Jim Vassallo