US bosses slash and earn

Sack-happy US corporate bosses are supposedly being paid 42% more than their peers...

by MT Staff
Last Updated: 19 Aug 2013
Here's a harsh dose of economic reality: apparently it pays to be cruel. According to a US think-tank, bosses of the 50 US companies that sacked the most staff during the recession earned a whopping 42% more than their peers. That's the grim conclusion from the Institute for Policy Studies (IPS), which found that the S&P 500's most vigorous axe-swingers earned an average of $12m in 2009 - nearly $4m more than the overall average. However you try to justify it, that doesn't look good...

Take Fred Hassan: the former head of drugs company Schering-Plough shed a whopping 16,000 jobs in a merger with Merck, as part of which he received a $33m golden parachute and took his total earnings to $49.7m. Elsewhere Johnson & Johnson boss William Weldon abandoned the company's 'no more tears' philosophy and pocketed $25.6m, despite 8,900 layoffs. Hewlett-Packard's former boss Mark Hurd also got $24.2m after 6,400 job losses (though admittedly things haven't worked out too well for him in other areas).

By contrast, their less trigger-happy peers pocketed an average salary of $8.4m. Although we're not going to shed too many tears for them - they still earned on average 263 times the typical net pay of an American worker, during a painful time of falling house prices and soaring unemployment.

Of course, you could argue that successfully sorting out an under-performing company - which will often sadly mean job losses - is precisely why CEOs get the big bucks.

Still, American bosses should be careful. With US unemployment figures expected to show a drop of around 105,000 in August, and the overall jobless rate still around the 10% mark, Obama's administration will be under increasing pressure to crack down on this kind of conspicuous earning.

Although it could be worse - if they were French, they'd probably have been bossnapped by now.

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