I have long been in favor of capitalism, free enterprise, and the right to keep as much of your earnings as legally possible. Honest efforts and real contributions should always be recognized and tangibly compensated. America has grown strong and accomplished on the backs of those who have worked long and hard and have come up with good ideas, better products and innovative practices. All should be honored, emulated, and justly rewarded.
Organizational leadership is critical to articulating an attainable mission for the enterprise, acquiring the needed recourses, identifying the market, acquiring the best technology, complying with all applicable laws and regulations and providing overall direction. Labor contributes the other essential leg for the successful enterprise; providing the muscle to implement, to execute and to deliver on a final quality product. Management and labor are in a crucial partnership, both are essential for the success of the enterprise. Both should be fairly compensated for their specific contributions.
But for some time things have gotten out of kilter. In too many places top executive pay seems to have soared, with seemingly little correlations to results, while worker wages have somewhat stagnated. A couple real examples in point from 2020 corporate results:
Company A reported a loss of $5.4 billion, CEO’s compensation $21 million
Company B reported a loss of $12 billion, CEO’s compensation $21.1 million
Company C reported a loss of $720 million, CEO’s compensation $56 million
Company D laid off 20,000 workers, CEO’s compensation $73 million
According to the Economic Policy Institute, between 1979-2019, while net productivity increased by around 70%, hourly compensation increased only about 12%. Current efforts to raise the minimum wage is an attempt to address this; is it too little, too late?
The gap between executive and worker compensation seems to keep getting bigger. There remains a shared responsibility but not a shared recognition. The divide exists not because it is right but because it is possible. Actions of boards, made up largely of executive peers, perpetuate the disconnect, not because they must but because they can. While there are many corporations and businesses that are totally above reproach in dealings with their employees, there continue to be too many glaring examples of corporate greed in America. There seems to be no regulation and little oversight to a corporation’s abuse of its responsibility to its employees. Only its shareholders have that power. Where are they?
- – – – Just the view of a common man
Views of a Common Man 
You are so very right !
Sent from my iPad
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The problem is compounded by the fact that wage increases are usually based on a percentage raise above one’s current salary. If one’s current salary is low and the executive’s salary in much higher, everytime one gets a raise it increases the discrepancy between the two. What needs to be done in address the base salary of the workers who make the product without increasing the base salary of the executives. Unfortunately, the one to make that decision are the executives and they are unwilling to correct the wrong.
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