A recent report from the Economic Policy Institute, a non-partisan Washington think-tank, states that the heads of the 350 largest U.S. Corporations had a raise in salary of 17.6 percent in 2017 which resulted in an average of $18.9 million in take-home pay. The average worker's salary barely moved last year with an average increase of just 0.3 percent.
This means that the big boss to worker compensation ratio in that country is 312 to 1, which is 5 times higher than the 58 to 1 ratio of 1989. Executive pay packets in the United States have grown almost 72 percent since 2009. Executive pay is rising faster than stock prices or corporative profits, having increased by 1,070 percent between 1978 and 2017, compared to a 637 percent hike in the S & P Index.
Canadian executives are also faring quite well and earn 200 times the average workers salary. To understand this difference you have to intellectually digest the fact that if you are working at minimum wage you would have to be on the job full-time for more than a month to earn what the average corporate boss earns in an hour.
One can't help but think that things are getting a bit skewed. Let's consider that the lower wage earner is working as a lineman for a large power company while the CEO oversees things from his or her comfortable, very posh office. A huge winter storm has hit the area and the lineman is out with his colleagues to restore power to thousands of people. Winds are blowing and temperatures are well below zero. At that particular time it is quite easy to note exactly who is the valuable employee. The lineman might understand how grateful the masses are to have power restored...yet understandably be a bit miffed that he has not received a wage that keeps up to the cost of living index.
In a recent column I reported on the fact that there is very little difference in the lifestyles of workers in Denmark and their bosses. Taxes are very high in Denmark. Those taxes insure that all citizens will have access to a good wage, good health care, education through university years, child care, and maternity leave for mothers and fathers in the event of a new addition to the family. Other Nordic countries experience the same benefits, and the people of Scandinavia are at the top of the happiest people in the world.
The United States has not fared so well, having slipped from the number 10 spot to the 18th spot. In addition the the craziness of Donald Trump's administration, it is very possible that the huge tax breaks for corporations are not resulting in wage increases or more job opportunities which could affect level of happiness in people to the south. On the other hand, Canada has done quite well. We have moved up from the number 8 spot to number 5.
It can be noted that the happiest people are from countries that have a lot of social programs, resulting in a sense of security and well-being. Seeing self as a valuable worker and member of society is a likely factor. Time with family and friends is also important to a well-rounded existence. Nevertheless, I would like to see a bit less gap in wages between the lineman and the CEO.
Shirley Hallee is a freelance writer living in Amherst. Her column appears weekly in the Amherst News.