Over the past four decades executive compensation has increased by a staggering 997 percent. Executives today are paid on average 300 times more than the annual salary of a production line worker whose average pay is of $51,000. These numbers are astounding when further compare to the average annual salary of a CEO, $10.5 million. Furthermore, in 1965 executive compensation was at a 20 –to– 1 ration and in a recent 2017 study that ration has grown to a 271–to– 1 ration. These increased salaries for executives have been increasing at a steady rate while workers’ salaries have only increased by 12% over the same period. This has caused one of the biggest wage gaps in history so far. Enormous pay increase, over that past years can be partly …show more content…
However, there are verities of reasons to prove paying executives is necessary. For starters executives typically have higher work hours than that of a production line worker. This includes in the office and out of the office work, like entertaining investors, travel, and company events. Executives’ level of responsibility and commitment is also radically different when compared to that of an average employee, who stop think about work once their work shift is over. CEO’s workweeks extends from the traditional 9 – to – 5, and often take work home, work on weekends and characteristically wake up much earlier for a verity of reasons. They also tend to give up more family time, and are constantly aware of the company. Hence my reasoning to believe that it's acceptable to pay executives, more but not fair. It is unfair to simultaneously lay off employees due to executive negligence, while also paying those same executives millions of dollars. In 2013 JC Penny’s CEO, Ron Johnson, caused the firing of nearly 19,000 employees and a dramatic decline of 51% in shares. During this period of rebranding he continued to earn bonuses and was paid millions. Well its not just to limit an executives’ salary there should be established boards to hold said executives responsible for negligence and make them accountable to