‘Hourly’ Pay for Fast-Food CEOs Is Astonishing
As legions of fast-food workers and their supporters prepare for a major nationwide strike next week, they’re getting some powerful ammunition in their push for a $15-an-hour minimum wage: An analysis published Monday shows an enormous chasm between the wages of the average restaurant worker and food-chain CEOs.
USA Today looked at the pay of the top dogs at 13 of the country’s leading restaurant and retail companies—two industries that have made plenty of feel-good headlines recently as titans such as Walmart and McDonald’s have moved to raise workers’ hourly pay.
But even as these companies seek to boost their frontline workers’ wages to around $10 an hour, that would still leave a jaw-dropping pay gap.
Assuming a 40-hour workweek, the CEOs at the 13 companies in the USA Today analysis rake in an average of $5,859 an hour. An employee making $10 an hour and working seven days a week, 10 hours a day, would have to work more than two months straight to pull in that much. With these CEOs making more than $1.60 a second, it’s not too far-fetched to say that they’re paid more for blowing their nose than than what they’re touting as an equitable wage for an hour’s worth of work by their companies’ lowest-paid workers.
It’s a divide that, although particularly stark in food and retail, exists across industries. A typical worker’s compensation grew a paltry 10.2 percent between 1978 and 2013, while average CEO pay exploded by 937 percent, according to an analysis last year from the Economic Policy Institute. Yet for much of the last 50 years, during which the U.S. experienced robust periods of economic growth, the gap between what CEOs made versus what the average worker made wasn’t nearly so yawning. Back in 1995, it was “only” about 123 to 1. In 1978, it was around 30 to 1, and in 1965, three years before McDonald’s rolled out the Big Mac nationwide, it was a mere 20 to 1.
Conspicuously absent in USA Today’s analysis is the compensation for McDonald’s CEO Steve Easterbrook, whose pay package has yet to be released by the company, because he’s been on the job less than a year. “Hourly wages” for other CEOs in the restaurant biz are as follows:
• Chipotle co-CEO Montgomery Moran: $13,489 an hour
• Chipotle co-CEO Steven Ells: $13,471 an hour
• Starbucks CEO Howard Schultz: $10,285 an hour
• Dunkin’ Brands CEO Nigel Travis: $4,889 an hour
• Yum! Brands CEO David Novak: $4,795 an hour
• Wendy’s CEO Emil Brolick: $3,645 an hour
• Domino’s CEO Patrick Doyle: $3,571 an hour
• Dine Equity CEO Julia Stewart: $2,766 an hour
• Panera Bread CEO Ronald Shaich: $1,292 an hour
Of course, as USA Today points out, most CEOs probably work more than 40 hours a week. Although it’s debatable just how grueling those extra hours are, given the time spent cruising at 35,000 feet in the corporate jet or confabbing over cocktails and hors d’oeuvres at lavish board retreats, the paper also breaks down CEO compensation assuming a 60-hour workweek. Chipotle’s Montgomery Moran still hauls in almost $9,000 an hour, and who among us wouldn’t consider working an extra 20 hours a week if it meant taking home a cool $180,000—which, as it turns out, is near the median price of a house in the U.S. right about now?
Conservatives often argue that chief executives deserve such outsize compensation because they are responsible for the kind of capitalist wizardry that transforms the ordinary experience of, say, serving up burgers or bean burritos into extraordinary returns for investors. Shares of Chipotle, for example, rose 29 percent in 2014.
But does such success really require CEOs to be paid 300 times more than the employees who make the company’s lattes or ring up those Bacon Double Cheeseburgers?