The Controversial Issue of Executive Pay in America

Topics: Household income in the United States, Chief executive officer, Executive officer Pages: 3 (1238 words) Published: April 24, 2012
The Controversial Issue of Executive Pay in America

The Controversial Issue of Executive Pay in America
Over the past twenty years, America has seen a substantial amount of change and development amongst many technological industries. Old ideas have been revolutionized. Technology has been continuously upgraded time and time again. Americans slowly have to do less and less because new inventions are constantly increasing their abilities to do more for us. Cars are getting faster, phones are getting smarter and before we know it, 2-dementional televisions will be a thing of the past. Despite everything that is growing around us there are still few things that have stayed the same; for example, the average American income for 99 percent of the population. In 1998, the income of an average American taxpayer was $33,400. Two decades later in 2008, the average income was still only 33,000 (Censky, 2011). What about the other one percent of the American population? Well, those making $380,000 or more per year have experienced a change mimicking our country’s technological development, seeing upwards of a 33% increase in annual income (Clark & Bobo, 2012). So who exactly qualifies as part this one percent? The majority of us work for them. It’s the chief executive officers (CEOs) of our nation’s most successful companies.

To further illustrate just how large of a gap has formed between income levels, we can look at comparisons in pay rates over the years. Looking back at 1980 again, CEO pay was 42 times the median worker’s pay. By 2010, CEO pay had increased to 343 times the median worker’s pay (Clark & Bobo, 2012). In extreme cases, such as the highest paid U.S. CEO Philippe P. Dauman of VIACOM, an employee of his earning the median salary would have to work for 2,497 years in order to match what the CEO earns in just one year. This is by far the widest gap in the world, and has started to cause many problems amongst the remaining 99 percent of the...

References: Censky, A., (2011, February 16). How the middle class became the underclass. Retrieved from
Clark, P., Bobo, K. (2012). Executive Pay Watch. Retrieved from
Lyon, S. (2008, July 31). CEO salaries: What is the average salary of a CEO? Retrieved from
Nickels, W. G., McHugh, J. M., & McHugh, S. M. (2010). Understanding business, Ninth edition. United States of America: The McGraw-Hill Companies, Inc.
Saez, E. (2010, July 17). Striking it richer: The evolution of top incomes in the United States. Retrieved from
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Executive Pay Essay
  • Essay about Executive Pay
  • Essay on Abortion: the most controversial issues in America
  • Executive Pay Essay
  • Controversial Issue Essay
  • Executive pay and income inequality Research Paper
  • Controversial Issue Paper Done
  • Abortion

Become a StudyMode Member

Sign Up - It's Free