A sobering statistic this morning from lobby group The High Pay Centre - by mid-morning today, the UK's top bosses will have earned £27,000 - more than the average worker will take home in the whole of this year.
The High Pay Centre has dubbed this pay landmark ‘Fatcat Wednesday’ to draw attention to the fact that company leaders earn 160 times more than the average employee.
FTSE 100 chief executives are paid an average of £4.3m a year – an hourly rate of £1,100 an hour. This means they only have to put in 24 hours of work, on returning from the Christmas break, before they surpass the UK average wage of some £27,000.
MT has never been against high pay per se, and would be tempted to say 'So what?' to these revelations but for one important point. That is that wages for ordinary workers have remained flat in the past decade as a result of the global economic downturn and pressures on the cost of living. Executive pay meanwhile increased by 74% in that time, says the High Pay Centre, so the tide is not rising for all the boats.
The latest figures from the Office for National Statistics show that wages grew by just 0.8% last year, while inflation currently stands at 2.1%.
High Pay Centre Director Deborah Hargreaves said: ‘Fatcat Wednesday highlights how insensitive big company executives have become. When top bosses take home more in two and a half days than the average worker earns in a year, there is clearly something wrong with the way pay is set for both bosses and workers.’
Executive pay has been a controversial issue since the credit crunch. The focus has been on Switzerland, which is home to at least five of Europe’s 20 best-paid CEOs. In November, Swiss voters rejected a proposal to limit executives’ pay to 12 times that of junior employees.
‘Soaring pay inequality is damaging our economy,’ said TUC general secretary Frances O'Grady.
But the days of such inequality may be drawing to a close - as the economy picks up, 2014 will likely see a return of the war for talent, with its accompanying upward pressure on salaries. Let's hope so anyway...