The latest data on FTSE 100 CEO salaries reveals a significant disparity in earnings compared to the average UK worker. As of early 2024, the median pay for FTSE 100 CEOs (excluding pensions) is reported to be £3.81 million, which is 109 times the median full-time worker’s pay of £34,963. This figure represents a 9.5% increase in CEO pay from March 2023, compared to a 6% increase in the median worker’s pay over the same period.
The High Pay Centre’s research indicates that by around 1 pm on Thursday, 4 January, the median FTSE 100 CEO’s earnings for 2024 had already surpassed the median annual salary for a full-time worker in the UK. This highlights the third working day of the year as the point at which CEO earnings exceed the annual pay of the median worker.
In comparison, other top earners in the UK have different timelines to surpass the median full-time worker’s annual salary. For example, other FTSE 350 executives have a median pay of £1.32 million and would need to work until 10th January to overtake the annual pay of the median UK worker. Partners at ‘magic circle’ law firms, with an average pay of £1.92 million, would reach this point by 8th January, while partners at ‘Big Four’ accountancy firms, earning an average of £871,000, would need to work until 16th January.
The substantial pay gap between CEOs and average workers has sparked debates and concerns about income inequality. Advocates for higher CEO pay, including leading figures in the city and big business, argue that competitive compensation is necessary for attracting top talent and ensuring economic success. However, critics, including the High Pay Centre and the Trades Union Congress, emphasize the growing inequality and the stagnating living standards for the majority of the population. They highlight the need for a more balanced approach to compensation that considers the broader economic context, including the ongoing cost of living crisis and wage stagnation among lower earners.
This situation raises questions about the sustainability and fairness of the current compensation structures within the corporate world, especially in light of the widening pay gap and its implications for social and economic inequality.
